Will London provide more affordable housing in the future?

We believe home renovation companies should be in the know when it comes to the housing climate, as it directly affects them. That is why we would like to address London’s housing crisis, exploring how the government is working to provide more affordable housing. Being able to afford a well-built property means money can be allocated to adapting a small/medium sized structure to meet your needs. For example, a dormer extension in London can add much needed floor area without sacrificing garden space and create quieter space away from the hustle and bustle of the streets below.

It’s clear that London is dealing with a huge housing crisis at the moment, as the city becomes denser every day, welcoming over 70,000 new Londoners each year. Our large and diverse population is something to proud of, but the lack of affordable housing cannot seem to keep up with the demand. It is fair for Londoners to want a fair chance at owning a property without having to sacrifice space and quality. In today’s post, we highlight how London is addressing the housing crisis, why it’s so important to resolve, and what are the next steps.

What is an Affordable Home?

The Mayor of London, along with his predecessors, would define affordable housing as, “homes to buy close to £500,000 and homes to rent at 80% of market rate”. This is not just social/council housing but aims to make housing accessible to people with varied incomes.

Currently, the average house price in London is £681,907 whereas the average house price in Manchester is £248,397. Furthermore, the average rent pcm in London is a whopping £2,100, in contrast to Manchester’s £1,291 pcm. This shows a huge disparity between two busy cities, which is frankly astonishing.

Schemes aimed at solving the crisis

In 2016 Sadiq Khan introduced the Affordable Homes Programme 2016-2023 to improve the housing climate in London. The aim was to build 116,000 affordable homes by 2023. Khan obtained £4.8billion from the government to help housing associations, community groups, London boroughs, and private developers. This would encourage each group to consider building quality, affordable properties as they would be eligible for funding. The deadline for this programme was extended due to the pandemic.

Alongside the 2016-2023 programme, City Hall introduced a separate Affordable Homes Programme for 2021-2026. This extra support from the government of £4billion was needed to offset the rising cost of building materials and shortage of construction workers due to Brexit. Ultimately, Khan’s main aim of the programmes was to make half of all new houses affordable, provide accommodation for the homeless, and for these homes to be of high quality. It is evident that quality of housing can directly impact quality of life, therefore the builds must meet housing design and sustainability standards.

Organisations can request funding from the schemes, but the housing developments must make sure they meet affordable rent benchmarks for 1 to 6 bed housing with weekly rent ranging from £168 to £218. The scheme helps people on low income, Londoners on average incomes wanting to save for a deposit to purchase their first home, and those wanting to buy a property but cannot afford anything on the open market.

Negative reception

Despite London’s efforts to create more affordable housing, 67% of Londoners are still expecting house prices to rise over the next 3 years. 75% of them do not believe enough help is provided to access affordable and quality homes. As a result, London is the most dissatisfied city in Britain when it comes to the current housing market. As we have observed through the pandemic and the conflict in Ukraine, sometimes the state of the world is out of our hands, yet it plays a huge role in pricing and the market.

Optimistic future

As both of these schemes are still in motion, there is definitely more to come in terms of affordable housing. Construction is always going on in and around London, so we think there could be an uprise in affordable living, although a lot of these builds may be apartments and high-rise flats. With new modern housing standards in place, these apartments are built to a much higher standard when compared to the brutalist, post-war tower blocks.

If you are considering extending or renovating your home to make better use of your property, why not give us a call? Our friendly team of professionals would love to hear from you! You can call us on 02070432378 or contact us via email at hello@hometales.co.uk. Alternatively, book in a telephone consultation with a senior member of our team. You can pick a time that best suits you and pick the right type of consultation for you by clicking here.

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