London needs a homebuilding kickstart package, with social housing at its heart
The government’s economic statement tomorrow is an opportunity for the chancellor to put building new homes at the heart of a plan to kickstart the recovery and help Britain bounce back after coronavirus.
To achieve this, we need to see much more than Boris Johnson set out in his speech in Dudley last week. A half-hearted set of housing re-announcements won’t cut it in the face of the Covid slump.
We need a major package to protect jobs and boost housebuilding, with a Covid-19 recovery plan that champions the building of thousands of well-designed social and council homes.
Research by Savills for the housing charity Shelter shows just how important this is. The impact of coronavirus on the construction industry is set to mean up to 300,000 fewer homes are built over the next five years, and nearly a quarter of a million construction jobs lost this year alone.
And so, to coordinate our efforts in London, I’ve brought together representatives of the capital’s councils, housing associations, trade unions and construction industry to form a Covid-19 Housing Delivery Taskforce. We’re all in agreement about what Rishi Sunak could say tomorrow to put our city and country on the road to recovery.
London went into lockdown as we came to the end of a record-breaking year for building the types of homes Londoners desperately need. Last financial year, Sadiq Khan started more than 17,000 genuinely affordable new homes, more than at any time since GLA records began in 2003, and started more than 3,300 new council homes, the most in any year since 1985 – the year I was born.
But to maintain this momentum as we emerge from the pandemic, we need a new £5bn funding package to reinvigorate the sector, give certainty to the housing market, and prioritise the type of housebuilding that Londoners need.
First, we need £3.5bn of new funding for councils and housing associations in London to step in to buy up private housing units at cost price that wouldn’t otherwise be sold. This would increase social housing supply and give the wider construction industry the certainty it needs to build.
The rest of the money would be used to boost London’s current affordable housing stock by converting homes that are set to be built for sale into the type of housing for which demand is greatest: social housing and “London Living Rent” homes that will enable middle-income Londoners to save for a deposit while renting.
We also need ministers to look to the future. After this initial injection of funding, the government needs to commit to properly supporting our affordable home building programme. Research carried out by the GLA and the G15 group of London’s largest housing associations last year found that the capital would need £4.9bn every year for the next decade to meet housing needs — seven times what the Westminster government currently contributes.
Investment in housing is a win-win-win. It means thousands more of the social and council homes that are so clearly needed, it gives certainty to the wider housing market to keep on building, and it protects vital construction jobs at a time when unemployment is rising across the country.
London government and our whole housing sector stand ready to help kickstart the economic recovery, not just of the capital but the whole country. Tomorrow is the time for the chancellor to be bold, and back building the homes we need.
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