Mayor moves to reform delivery of affordable housing

Press Release

Mayor moves to reform delivery of affordable housing
23-10-2008 549

Mayor of London Boris Johnson today took the first steps towards removing the 50 per cent London wide affordable housing target, a key manifesto pledge, as he opened negotiations with London boroughs to agree a programme to deliver 50,000 affordable homes across the city over the next three years.

Instead of imposing the existing ‘one size fits all’ target from City Hall, which is particularly unsuitable in the current market, the Greater London Authority (GLA) will work with every London borough to agree individual targets for the number of affordable homes they can deliver based on their unique local circumstances.

To begin this process the GLA has today written to every London borough proposing an indicative target for affordable housing delivery over the next three years taking into account local housing capacity, recent affordable housing delivery and any existing targets the boroughs have committed to. Each borough will have the opportunity to present their own evidence in discussions with the GLA before final targets are agreed early in 2009.

The Mayor believes that a more collaborative approach to working with boroughs will deliver the affordable homes that Londoners need and reduce the capital’s housing waiting lists. The commitment to the housing investment target will be included in his draft London Housing Strategy, and the Mayor has pledged to alter his London Plan to remove prescriptive and what he believes are counter-productive targets such as the 50 per cent affordable housing target for new developments.

The Mayor said:

"Too many Londoners continue to struggle to get a foot on the housing ladder, and many more are homeless or living in desperately overcrowded or poor quality housing with their families. The current policy of imposing an inflexible London wide target clearly does not work and in these exceptionally tough times it is imperative that we make the right investments now to provide the homes that Londoners need.

“Make no mistake - I want all the boroughs to make their fair contribution towards achieving our goal. But I believe that this can only happen by working with them so that we take account of individual circumstances and agree together what can sensibly be delivered."

The Mayor's Director of Housing Richard Blakeway said:

"In a challenging housing market, the 50 per cent target will simply deter development slowing down delivery of all new housing across the board. Historically under the aspirational target only an average 34% of new homes built were affordable, far less than the 50 per cent envisaged. The market now requires a fresh approach that focuses efforts on generating units in partnership with the boroughs and does not act as a barrier to developers. This is why we believe this move will put London in a stronger position to deliver the affordable housing the capital still needs despite the difficult circumstances."

Notes to Editors

The Mayor has pledged to deliver 50,000 affordable homes across London over the years 2008/09 to 2010/11, comprising social rented housing, intermediate products such as shared ownership and the Mayor’s new First Steps Housing scheme.
The Mayor will soon publish for consultation a draft statutory London Housing Strategy setting out details of First Steps Housing and his other policies for tackling London’s housing challenges.
The affordable housing investment targets to be agreed with boroughs are calculated in the same way as the government’s targets for affordable housing delivery. They are not the same as the long term planning targets that are set out in the London Plan and those contained within boroughs’ planning policies. The two major differences between this 50,000 housing investment target and the planning targets are:
The housing target is a gross figure – ie it does not subtract loss of affordable homes through demolition, as the planning target does. The housing target is not just new build homes (as the planning target is) but also includes acquisitions of second hand homes, such as Open Market HomeBuy.
Using the housing investment target definition, 13,220 affordable homes were delivered in London in 2006/07 (according to Department for Communities and Local Government affordable housing statistics), considerably higher than the 9,209 affordable homes delivered the same year as measured by the London Plan Annual Monitoring Report.
Twenty-two London boroughs have committed to Local Area Agreement (LAA) targets with the Government for delivery of affordable housing in their borough over the same period, 2008/09 to 2010/11. The Mayor has agreed with the Government that any new targets he agrees with boroughs will replace any existing LAA targets. This change will apply only to the LAA target on affordable housing delivery.
In July 2008 the Mayor published ‘Planning for a better London’, setting out the key areas he intends to address in revising the London Plan, including altering the Plan to remove prescriptive and counter-productive targets (such as the 50 per cent affordable housing target for new development) and to enable a higher proportion of shared ownership and other ‘intermediate’ housing.