Tackling London’s housing shortage demands greater pragmatism, honesty and creativity from all sidesFebruary 15, 2018
Craig McWilliam, CEO, Grosvenor Britain & Ireland
The capital’s response to its housing crisis will only be successful with bold public sector leadership led by vision and an honest depiction of the trade-offs and difficult decisions inherent in urban development.
Take the embryonic Build to Rent sector, which has enormous potential to bring more affordable homes to the market more quickly than traditional housing for sale schemes.
There is substantial private capital looking to invest in the UK: £30bn in the next 5 years according to the BPF, and London’s government has the powers needed to attract that capital to fund many new rental homes. However, for this sector to reach its potential, we urgently need robust placemaking leadership in three areas:
Firstly, we need a clear and deliverable London-wide policy to give impetus to the sector. Investors and developers often don’t know where they stand in London, creating an environment that constrains investment.
We welcome the Mayor’s work to articulate BtR policy, including recognition in his draft London Plan that the economics of BtR are different to those of housing for sale. The plan also argues discounted market rental homes should be viewed as traditional affordable housing, which is positive and bold. This is a step in the right direction.
Secondly, we need to improve the quality of the housing debate. BtR will not deliver the same percentage of affordable or social rented homes as housing for sale. It is not a silver bullet for the housing crisis.
The Mayor already recognises this difference, but I would question if the public, our residents of the future, understand this. The descent of the housing debate into a standoff between developers and communities threatens to stall the delivery of more homes, aggravating today’s issues.
So thirdly, we need a new public narrative on what constitutes affordable housing.
Our planning system fails too many on low and middle incomes. BtR can meet some of those needs by bringing market and below market rental homes to the supply.
Nevertheless, as BtR developments will not be a significant source of social rented housing we need a broader conversation about the definition and accessibility of affordable housing.
Success is predicated on bold public sector leadership. The housing shortage demands greater pragmatism, honesty and urgency from all sides. The Mayor and civic leaders should engage Londoners and local authorities in the full choices available and enable an honest discussion of the difficult decisions that have to be made, not a narrow range of soundbites. The opportunity, and the cost, is too great to ignore.