The capital has to build 66,000 new homes each year to meet the demands of a growing population – but last year less than 21,000 were launched thanks to funding from the Greater London Authority (GLA).
More than 17,000 affordable housing units were inaugurated in 2019/20 – a city hall record, although still well below needs.
But London never reached its post-war home-building goal, deputy mayor Tom Copley said today (Monday June 8).
The capital needs five times more liquidity than it currently receives from the government to build low-cost homes, he said – around £ 4.9 billion a year for the next decade.
City Hall has received only £ 4.8 billion in the past five years, less than the demand for a single year.
The Mayor of London uses three definitions of “truly affordable housing”, targeting Londoners on a range of incomes:
- Shared ownership programs to help private tenants access the property ladder by purchasing part of their home;
- Living rent, which cannot represent more than a third of the region’s average income;
- And the even lower social rent, the mayor’s preferred option.
Seventy percent of affordable housing should be rented socially, according to research by the Greater London Authority (GLA) and the housing association G15 published last year.
But the government has given priority to building cheaper housing for those wishing to buy for the first time.
The funding is currently split “about fifty-fifty” between properties built for rent and those built for sale, said Copley.
The newly-appointed deputy mayor – who served on the London assembly until the end of March – said that London is currently “entirely dependent” on ministers to finance the construction of affordable housing.
“Alternatively, the government could give us more powers to raise taxes,” he said.
“The current and previous mayors have called for the devolution of property taxes in London, and we would be very happy to do so.”
The current crisis – especially when the recession hits – will only increase the need for low-cost social housing
Current property taxes include stamp duty, paid on purchases over £ 125,000, and capital gains tax, paid on the sale of an increased home.
And Prime Minister Boris Johnson called for greater fiscal decentralization in the capital – including stamp duty – in 2013, when he was mayor of London.
The government announced a new national affordable housing program in its latest budget – and Secretary of Housing Robert Jenrick said it would be “even more important” than the current program.
But the town hall has no details yet on these future plans, said Copley.
“We do not yet know how much of the funding London will get, what the allocation of tenancy rights will look like in the future affordable housing program – or even what level of delivery ministers will expect,” he said. told the committee.
The city will certainly need “a significantly increased level of investment in affordable housing,” he warned – the coronavirus may worsen the situation.
“I can only imagine that the current crisis, especially when the recession hits, will only increase the need for low-cost social housing,” he said.