What Zac Goldsmith and Sadiq Khan mean for London’s house prices and skyscrapers
The cranes that crowd London’s skyline are deceptive. While the capital is building at a ferocious speed, it needs more houses than ever before. A lot more houses.
Estimates of how many should be built each year to meet demand range from 50,000 to 80,000. Last year, only half that were built, even though London’s population is projected to grow from its current 8.6m inhabitants to 10m by 2030.
A severe lack of supply has pushed prices up so far in the capital that the affordability crisis is starting to spread, like a contagion, to the outer commuter belt: house prices in Slough jumped 19pc in the year to February 2016. It seems a lot of people disagree with poet John Betjeman’s dismal “Come friendly bombs” viewpoint.
London’s housing problems have been bubbling up for years. But now, with just 11 days to go until the capital’s 8.6m residents decide who should replace Boris Johnson as Mayor of London, they have become a priority.
The main candidates – Labour’s Sadiq Khan and the Conservatives’ Zac Goldsmith – agree what needs to be done: 50,000 more houses have to be built every year. But there’s a snag: making it happen. Guy Grainger, the chief executive of commercial estate agents JLL, believes hitting the target will be “really hard”.
A survey of London house-builders carried out by property consultancy McBains Cooper found that the biggest restriction, cited by 30pc of respondents, to building in the capital is land availability. But that’s not the only problem.
Mr Grainger says: “There aren’t currently enough builders out there to build 50,000 homes. It’s a real question of how we can get there.” In the McBains Cooper survey, 28pc of respondents said the industry was suffering skills shortages, particularly of carpenters and bricklayers.
While the two main mayoral candidates agree on the basic facts, each has a different focus. For Labour’s Mr Khan, affordability is key; but Conservative Mr Goldsmith wants to focus on medium-density development and for people to have more of a say over what gets built.
Housing is one of the few areas in which the capital’s mayor has a lot of power. Michael Gallimore, a partner specialising in planning at law firm Hogan Lovells, says: “In the planning arena the mayor is the most powerful individual because he has the right to call in schemes above a certain threshold to direct an approval or refusal, so he can influence up to the point of consent.”
Through the London Plan’s policies on issues such as design and space standards, the mayor has “the ability to influence policy-making to a very high degree of detail”. The two main candidates have similar manifestos when it comes to housing. And all of the candidates are vehemently against building on the green belt.
In his campaigning, Mr Goldsmith is focusing on providing housing for those on “average salaries”, proposing an increase in higher-density, low-rise housing, as championed by campaign group Create Streets, which wants to revive something similar to London’s Georgian and Edwardian terraces.
Mr Goldsmith also proposes three-year leases as standard, giving more power to tenants, and replacing every council house sold through Right to Buy with two new ones. In the past five years, only one has been built for every 10 sold.