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London’s housing crisis is an economic as well as social problem

The Financial Times has reported that 82% of Londoners aged 20 to 45-years-old say they will never be able to buy a property, while the proportion of people saving for a deposit has dropped by six percentage points over the last year.

The research, conducted by the Halifax, reiterates the findings of London First’s recent report ‘Moving Out: how London’s housing shortage is threatening the capital’s competitiveness’.

Moving Out, commissioned in conjunction with global construction consultancy Turner & Townsend, found London’s housing crisis is fast becoming a threat to jobs and growth in the city.

It found:

  • A majority of workers (56%) have difficulties paying the rent or mortgage and up to a half of them (49%) could leave London to work elsewhere for this reason
  • Three-quarters of businesses surveyed warned that the lack of new homes and rising housing costs are “a significant risk to the capital’s economic growth”
  • A sizeable proportion of firms (38%) are already voicing concerns about how this is affecting recruitment and retention

Last year we set out 12 recommendations to solving London’s housing crisis in our report Home Truths.

We have since begun detailed analysis of these recommendations and, so far, have released:

  • The Green Belt: A Place for Londoners? which called on local authorities to begin a re-evaluation of their Green Belt land to help solve the capital’s housing crisis. It found that, while a policy of building new homes on ‘brownfield land first’ should be sustained, it was unrealistic to assume that brownfield sites would provide sufficient land to meet London’s housing need.
  • Wasted Space to Living Place was the first analysis of the challenges facing the London Land Commission. It is tasked with developing a comprehensive database of surplus public land in London – a 21st Century Domesday Book – a key ask of Home Truths. According to the report, the Commission’s two principal objectives should be:
    • setting a realistic target date for working out what public land and assets are surplus and, in turn, are suitable and viable for housing. It added that the majority of the data collection and initial analysis should be completed before the Mayoral Election in May 2016;
    • to establish a rolling yearly target for moving surplus land and assets forward for release. A good, if arbitrary, target would be ten to fifteen per cent of the land identified (after allowing a suitable period for bedding in and start up), the study concluded.

Read more about our work on solving London’s housing crisis

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