London Assembly report reveals that the Mayor’s progress in affordable housing programs has faced challenges due to various factors impacting all housebuilding efforts. While there has been an increase in the proportion of social rent dwellings, the overall number of City Hall-funded affordable homes started last year was lower compared to the previous year.
The annual affordable housing monitoring report by the Assembly housing committee tracks the Mayor of London’s government-funded housebuilding progress. The report highlights the difference in funding conditions between the 2016 and 2021 programs. Under the 2016 deal, only 39% of the total homes funded were allocated to social rent, while the 2021 settlement increased this quota to 60%.
The report indicates that the Mayor is on track to meet the 60% social rent goal, with social rent homes accounting for 88% of starts in 2023/24. Additionally, the target for new council homes of 20,000 starts by March 2024 was achieved, marking the highest number since the 1970s. However, the Mayor’s commitment to delivering 40,000 more council homes by 2030 lacks specificity to assess its progress.
Affordable homes delivery has experienced a slowdown over the past year, reflecting the broader decline in housebuilding. The number of new homes of all types built decreased from over 21,000 in 2022/23 to 14,270 in the following year. Specifically, the number of affordable homes started saw a significant drop from over 25,000 in 2022/23 to 2,358 last year, leaving approximately 75,000 homes to be completed by 2030.
The economic challenges affecting housebuilding, such as high interest rates, inflation, skills shortages, and regulatory costs, have also impacted the affordable housing program. Social landlords are further constrained by government-imposed caps on social rent levels and borrowing, reducing their income and affecting maintenance and upgrades of existing homes.
Despite revisions to the Affordable Homes Programme targets and improved relationships between City Hall and Whitehall, the report emphasizes the ongoing need for affordable housing in London. The report will be discussed at the Assembly’s housing committee meeting, providing insights into the current status and future prospects of affordable housing programs in the city.
