More Affordable Housing to be Built in London
Sadiq Khan, the new Mayor of London since May, recently set out new planning rules that have been designed to speed up the building of 90,000 low cost homes in London, backed by a record breaking investment of more than £3 billion in the 2016 – 21 funding programme. This is by far the biggest housing deal ever secured by City Hall and the target of 90,000 homes by 2020 – 2021 is a massive 48% increase from the numbers of affordable homes built between 2009 – 10 and 2014 – 15. This is good news for the construction industry as a whole, coming at a strategic time when we’ve been worrying about the future following the shock Brexit vote last June.
New planning guidance has been launched too in a bid to adopt a more innovative approach to speeding up decisions in the planning process and to support build to rent schemes. Projects that involve less than 35% affordable housing will undergo heavier scrutiny than those that plan more than 35%. Backing this up, the government has set out new rules to ensure that investment in London can be spent on a mix of accommodation for low-cost rent and affordable home ownership.
Most of the homes in the programme will be provided by housing associations on the condition that their plans must include a minimum of 50% affordable housing, while other partners will need to provide at least 60% low cost housing. This Supplementary Planning Guidance marks a major step towards increasing the level of affordable housing in the capital, a welcome situation for so many who work in London. The Supplementary Planning Guidance (SPG) aims to achieve the following:
· A transparent, clear and consistent approach to ‘viability’, the process through which a development’s affordable housing contribution is assessed.
· Support new “Build to Rent” developments with institutions such as pension funds investing in blocks of long-term private and affordable apartments to rent.
· Provide develope4rs with a speedy new route through the planning process, eliminating the need for protracted viability negotiations if they meet a minimum 35% affordable housing.
Khan came to office determined to lead from the front when it comes to building genuinely affordable homes to rent and buy in London in a bid to fix the housing crisis in the city. This has been praised by the British Property Federation, whose Director of Policy, Ian Fletcher, commended the Mayor, his Deputy and his team for working with planners and investors in order to draw up a sensible planning policy. Fletcher has said that “recognising the sector and how it works in this guidance is a big help” when it comes to the sector’s commitment to deliver quality rental homes for Londoners.
London needs more rental accommodation which has been designed and built for that purpose. Increasing the number of affordable rental apartments is likely to attract more people to live in the capital, especially those with the knowledge and skills necessary to ensure that London remains one of the most important shopping and financial centres on the planet.