New analysis commissioned by Fifty Thousand Homes, supplied by Grant Thornton, shows that to meet the campaign pledge of 50,000 new homes to the city per year, the attrition rates between planning permission granted and those that are actually built – currently at 36% – will need to be tackled. As it stands, larger projects – those with between 100 and 149 homes – are the most likely to get off the ground.
The housing crisis in London continues, with analysis from Fifty Thousand Homes campaign finding that current construction trends are unlikely to see relief, particularly for young people and businesses, across the region. Net migration for 30-somethings into London continues to be negative, with around 30,000 more leaving than arriving each year. The average cost of a house in the capital is now more than 14 times average earnings, while three-times average household income is seen as a marker for affordable housing.
Recent analysis for the Fifty Thousand Homes campaign, supplied by Grant Thornton (one of the partners of the pledge), finds that even while planning permission has been granted to around 50,000 new homes since 2014, more than a third of the projects end not being built – the rate of project attrition has risen since 2010, from 28% to 36%. The analysis further finds that on average it takes thirteen months to move from planning permission to ground breaking, and a further 20 months to complete the project – noting a considerable lag time that will further slow implementation efforts as well as demanding higher numbers of projects – or a reduction in attrition rates – in the pipeline to meet the campaign’s target to bolster stock.
“This performance data is essential in informing our shared mission to tackle the shortage of housing in London. There is a desperate need to increase supply across the capital, and our analysis identifies those areas that need attention,” says, Sacha Romanovitch, Chief Executive of Grant Thornton in the UK.
According to the accounting and consulting firm, housing projects with between 100-149 homes are the most likely to rise from the ground, with the rate of attrition for the category at 22%.
Around 30% of the projects that are being built are considered ‘affordable’ housing, which includes including social housing, affordable rent, shared rent and shared ownership. This highlights further challenges faced by the Fifty Thousand Homes campaign's goal to make the capital more affordable for people from a broad array of backgrounds.
Jasmine Whitbread, Chief Executive of London First, who launched the Fifty Thousand Homes campaign, remarks, “The Mayor rightly said the election was a referendum on housing but it’s a huge job ahead. We’ll update these ‘scores on the doors’ every six months, tracking London’s progress and working with planners and developers to get to the bottom of what’s holding up housebuilding in the capital. A huge number of businesses are worried about their staff being priced out of the city, we have to act now to keep hold of the people that make London work.”
Romanovitch adds that solving London’s housing crisis would also strongly benefit the capital's future growth at a time when the economic outlook has weakened. "Additional house building projects in themselves will help to create jobs and stimulate growth and pivotal to achieving this is working collaboratively with the 32 London Boroughs and the City of London Corporation.”