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London housing shortfall expected

Written by Paul Williams
Monday, 13 October 2008
50,000 London homes by 2011 'extremely challenging.' The London assembly has today said the current economic turmoil will make the Mayor’s target of delivering 50,000 affordable by 2011 “extremely challenging” - at best – and innovative solutions are needed to boost the chances of meeting it, the London Assembly heard today. Related Articles Lloyds of London: Piracy pressuring insurance London still world leader Halifax reveals UKs most expensive streets RBS report: This is what a slowdown looks like Boost for council house construction A panel of experts appeared before the London Assembly’s Planning and Housing Committee today to explore the impact of the 'credit crunch' on affordable housing in the capital, and almost unanimously expressed doubts about the chances of hitting the Mayor’s target because of what one expert described as a “financial tsunami”. While home ownership remains a long-term aspiration, almost all the guests agreed that until people are once again able to get mortgages in significant numbers, the Mayor’s £4 billion for affordable housing would be best spent on the provision of social rented housing. This requires creative thinking: rented housing should not just be the province of housing associations, but the Mayor should urge and facilitate local authorities to build more housing for rent, and even institutional investors like pension funds should be encouraged to invest in building new rental housing. Nicky Gavron AM, Chair of the Planning and Housing Committee, said: “Sir Bob Kerslake1 told us today that the “most important thing is to maintain some momentum of activity in the sector”. “In the current circumstances it seems the focus of this activity should be on the provision of social rented housing. In the short-term this should be the Mayor’s focus. “There may also be some scope for an institutional private rented sector, similar to the European model, with an option to buy in the longer-term in some cases.” Today’s hearing will inform the Committee’s response to the Mayor’s forthcoming draft housing strategy, due for publication in November.