Homes for London: Easing the pressure, but not solving the problem

MHCLG and the GLA revealed on Wednesday their long-awaited response to London’s housing construction crisis. Measures such as the new time-limited planning route, partial CIL relief, design flexibility, and expanded Mayoral call-in powers should help unlock stalled schemes and improve delivery in the short term.

In particular, the ability to proceed without full viability assessments and the lowering of affordability targets from 35% to 20% will remove key bottlenecks. Funding support and relaxed design standards will improve scheme viability. These are sensible, targeted interventions.

Their overall impact is likely to be limited, however. With housing starts at just 5,500 in 2025 against a target of 88,000, the scale of the capital’s under-delivery is vast and embedded. These new measures may help bring to forward some schemes, but they do not fundamentally address the massive structural imbalance between supply and demand. There are also uncertainties around implementation, particularly how quickly and consistently local London authorities will adopt the new approach. More broadly, the focus remains on supply-side fixes, with less attention given to wider market conditions.

Taken together, the measures should ease pressure in parts of the system: unlocking some sites, improving confidence, and supporting schemes that are close to viability and find themselves at a frustrating blockade.

It should bring forward some additional construction in the capital. But the impact is likely to be incremental rather than transformative, leaving the underlying dynamics of London’s acute housing shortage largely unchanged.