Press Release

An Open Letter to the Housing Minister

Ahead of the Spring Budget, we are asking the government to honour its white paper commitment to help local authorities to build the new homes this country needs.

London is facing a housing crisis that threatens to derail the capital’s economy, as house prices and rents spiral out of reach for more and more Londoners. Affordable housing, rented or sold at less than market value, has formed part of London’s mix of tenures for more than 100 years. It houses the workers who help keep the city running – in 2015, people living in sub-market homes generated £15bn for London’s economy. But supply is not keeping up with need; less than a quarter of new homes built in 2014/15 were classified as affordable.

Private developers and housing associations have led affordable house building in recent years. London boroughs are building more, and have further ambitions to increase delivery and meet London’s housing needs, but are hampered by the high cost of land in the capital and restrictions on funding. New research by Centre for London has shown that the price of land can account for more than half of the cost of building a standard flat in a central London location, as opposed to around a quarter of the cheapest suburban equivalent, while Government regulations hamper joint working and civic enterprise.

If, as noted in the housing white paper, the government is serious about supporting councils with “all the levers at its disposal”, we believe it must unlock London boroughs’ capacity to collaborate in delivery, by cutting red tape in three areas:

First, we need the government to allow prudential borrowing against rental revenues (rather than capping this on the basis of historical debt levels), and to rethink reforms such as forced sale of high value council housing, to provide a stable environment for borrowing.

Second, we are asking the government to relax restrictions on the use of right-to-buy receipts, including extending the period within which they can be spent and increasing the proportion of the cost of a new home they can fund.

Third, we believe that there should be flexibility to spend funds (right-to-buy receipts, borrowing and developer contributions) across borough boundaries to facilitate enhanced collaboration and deliver greater quantities of affordable housing across London.

Without these urgent reforms, London’s councils will struggle to play their part in meeting London’s housing needs.


Sir Steve Bullock, Executive Member for Housing, London Councils, and Mayor, London Borough of Lewisham

Lord Kerslake, Chair, Peabody, and President, Local Government Association

Councillor Julian Bell, Council Leader, London Borough of Ealing

Philip Glanville, Mayor of Hackney

Councillor Alan Strickland, Cabinet Member for Housing, Regeneration and Planning, London Borough of Haringey

Councillor Rock Feilding-Mellen, Deputy Leader and Cabinet Member for Housing, Property and Regeneration, Royal Borough of Kensington and Chelsea

Councillor Matthew Bennett, Cabinet Member for Housing, London Borough of Lambeth

Councillor Damien Egan, Cabinet Member for Housing, London Borough of Lewisham

Councillor Stephanie Cryan, Deputy Leader and Cabinet Member for Housing, London Borough of Southwark

Councillor Khevyn Limbajee, Cabinet Member for Housing, London Borough of Waltham Forest

Jon Gooding, Chairman, Westminster Property Association, Housing Committee

Ben Rogers, Director, Centre for London

Killian Hurley, Chief Executive, Mount Anvil

Read the report here