Last week Sadiq Khan published his latest estimate for housing demand in the capital.
Every year, he says, 66,000 homes are needed and two-thirds of these homes must be available at below market rate. Blimey.
So can it be done?
Last December L&Q launched a bold plan to deliver 100,000 new homes over 10 years.
Since then we have acquired 80,000 plots of land, raised more than £3bn private capital and signed up to new partnerships to help us deliver.
Our aim is to double production from our current 2,500 homes to 5,000 homes each year over a three-year period. And then to double again from 5,000 to 10,000 homes over the remaining seven years.
As the mayor often says, this is a marathon, not a sprint; we are an ambitious organisation but it will take us 10 years to quadruple production.
G15, a group of the largest housing associations in London, has just committed to increase production by 50% – together delivering a total of 42,000 affordable homes over five years.
This is an unrivalled commitment to tackle the housing crisis head-on and almost half the mayor’s current 90,000 affordable homes target.
But compare this with the latest figures – 66,000 homes needed every year, two-thirds below market – that’s 42,000 below-market homes every year.
So the mayor’s ambition is to see London deliver every year as many below-market homes as the G15 is currently gearing up to deliver in five years. Quite a challenge.
It has been done before, back in the 1930s when the average number of new homes completed in the capital was, coincidentally, 66,000, with a peak of 80,000 homes in 1934.
To deliver on this scale took major investment in and expansion of the suburbs. Since then, production has been less impressive, with a post-War peak of 37,000 homes. Last year we delivered 23,000 homes.
So can it be done? Yes, in my view, but it will take four major changes.
First, investment: 42,000 homes will require something like £17bn investment every year. Presently housing associations borrow around £5bn every year. We will need to raise three times that figure just for London and that will require major intervention from central, regional and local government.
Second, land. If every house builder, local authority, developer and housing association is to get behind this ambition we will need to see a five-year pipeline of clean, serviced, consented land. Five years, 66,000 homes each year – that’s a pipeline of 330,000 plots.
Third, skills and means of production. Together, we will need to scale up massively our investment in apprenticeships and new methods of construction.
And fourth, collaboration and courage. We will have to work together in a way that hasn’t been seen since the Cathy Come Home or immediate post-War periods.
Can it be done? The question, is can we afford not to do it?
Can we afford to see even more families in temporary accommodation, even more people in an unregulated, insecure private rented sector, even more young people leave the capital to find a more affordable place to live?
We have a choice – to do something or face the consequences of doing nothing.
Can we do it? We must.
This blog was first published by Inside Housing on 6 November 2017