Khan calls for £5bn affordable homes investment

The Mayor of London, Sadiq Khan, has called for the government to agree to a multi-billion pound package to kick-start London’s housing sector in response to the coronavirus pandemic.

Alongside London builders, councils, housing associations and unions, Khan says that an emergency £5 billion investment package is essential to keep London building, protect construction jobs in the capital, and increase the supply of new social homes.

After the government heeded calls for the current affordable housing programme to be extended, Khan is now asking ministers to commit to a further £4.9 billion a year investment to build the council, social and other genuinely affordable housing London needs from 2023 onwards.  

The ‘Covid-19 Housing Delivery Taskforce’, convened by Deputy Mayor for Housing, Tom Copley, has outlined its demands for the recovery package to meet the massive housing needs in the capital, protect affordable housing delivery, and give confidence to the private sector to start new developments. The funding would be used to support two key policies: a ‘buyer of last resort’ scheme and a tenure conversions programme.

The £3.5 billion ‘buyer of last resort’ scheme would allow councils and housing associations to buy unsold private homes at cost price and turn them into social housing if a buyer cannot be found in the open market. The £1.33 billion tenure conversions programme would safeguard and accelerate London’s affordable homes programme by converting housing currently planned for low-cost ownership and sale into homes for social and low-cost rent.

It is beloved that these schemes would enable councils, housing associations and private developers to maintain housing delivery during the current period of market uncertainty as well as helping to address the longstanding backlog in housing supply which has built up over many years in London.

Khan said: “The government’s economic statement [8 July] is a chance for the Chancellor to put building new homes at the heart of a plan to kick-start the recovery. The whole of London’s government and housing sector stands ready to play a central role in supporting the recovery, not just of the capital but the whole country, if the Chancellor will gives us the resources we need. But I want London’s housing sector to do more than just bounce back, I want us to emerge from this crisis with a greater resolve to deliver the council, social and other genuinely affordable homes that London so desperately needs and to protect construction jobs. This investment package would help make that a reality.

“The work of London’s Covid-19 Housing Delivery Taskforce has shown the broad support across business, trades unions and the housing sector for greater government backing for new genuinely affordable homes. Ministers now have a unique opportunity to help address the issues of housing supply and affordability whilst also underpinning London’s economic recovery by supporting tens of thousands of jobs and training opportunities at a time when the housing market is in jeopardy.”