New homes alone won't fix London's housing crisis, mayor warned
Published by Max Salsbury for 24dash.com in Housing and also in Development, Local Government
New homes won't fix London's housing crisis, mayor warned
A new report calls on the Mayor of London, Boris Johnson, to focus on housing policies rather than just on increasing supply.
The report, from London Assembly Green Party Member, Darren Johnson (pictured), recommends bringing in rent controls and restrictions on overseas investors instead of merely increasing the amount of new homes being built as the best way of tackling the capital's housing crisis.
Darren Johnson believes house prices need to drop by a least 40% and by as much as 65% for housing to become affordable for the average household, claiming that it would take between 14 and 30 years for incomes to catch up if the current costs remain flat.
His report also finds:
• More than half a million homes should have built in London since the GLA was set-up in 2000 in order to keep up with a growing population and rising demand, while only half as many were built.
• The Mayor would need to find more land or build more dense suburbs to achieve that higher level of supply.
• Higher levels of supply could be incompatible with tackling climate change.
• The number of genuinely affordable social homes has reduced in the last decade, as Right to Buy sales have outnumbered the new homes being built.
• The affordable housing budget has been cut by 66%, leading to higher rents being charged on the already-insufficient number of affordable homes being built with funding from the Mayor.
• Building enough council housing for every private tenant on housing benefit could save £2.7bn a year in housing benefit bills.
Darren Johnson said: “We obviously need to build more homes to meet the needs of a growing population. But the Mayor cannot continue to pin all his hopes on private developers building more homes to meet the demands of Londoners, buy-to-let landlords, second home owners and overseas investors. The consequences of this failed approach will be many more years of rising rents, more people priced out of home ownership and a dwindling stock of genuinely affordable housing.
“The Mayor could pick from a rich list of solutions developed by academics, journalists and think tanks, putting them into his housing strategy and pushing the Government to adopt them. He should also drop his simplistic opposition to rent controls and see what we could learn from other countries in Europe such as Ireland, France and Germany.”