Kim Vernau, CEO, BLP Insurance comments on the impact of the mayoral elections on the London housing sector:
“Housing was a top priority for both candidates during the mayoral election campaign and now Sadiq Khan needs to prove that theory can be turned into practice. London is facing huge challenges, including the lack of affordable homes and the significant shortage of skilled labour, which will be exacerbated due to the ageing workforce.”
“Sadiq Khan has laid out his proposal to establish ‘Homes for Londoners’, a new team in City Hall made up of local councils and which will seek to build new homes on land owned by the Mayor’s office. He has also promised to develop other public sector land and exercise ‘use it or lose it’ powers to make sure developers who have planning permission actually build homes and don’t land-bank.”
“Khan’s blanket target for 50 per cent of all new homes in London to be genuinely affordable could result in fewer homes actually being built, as developers focus on more profitable developments. His plans to utilise £400 million of the Mayor’s affordable homes budget to support a target of 80,000 homes per year for Housing Associations will be challenging in the current environment where there is a lack of funding compounded by a lack of a sufficiently skilled workforce to enable that demand to be met.”
“We are at a critical juncture for the London construction industry and housing market. The city urgently needs to speed up the building of new houses for home owners and build-to-rent investors to provide sufficient options for the London population. Affordable housing and social housing should also be a priority. Balancing all these needs is a challenging task. This is likely to become even more complicated in the context of the new Housing & Planning Bill and potential Brexit factors that could further unbalance the construction labour market.”