Up to 10,000 new social homes to be built in London in next four years

Special funding is being made to councils in London to build 10,000 new homes over the next four years.

The Mayor Sadiq Khan has announced the funding programme in a bid to reverse the decline in affordable social homes since the Right to Buy policy was introduced in 1980.

In what will be the first ever City Hall programme dedicated to supporting council housing, using funds from the £1.67 billion Khan secured from the Government in the Spring Statement to help support London’s councils to increase dramatically the rate of council home building.

In the 1970s London councils were supported by central government and built more than 20,000 homes a year, but that number plummeted to almost zero during the 1990s. Today, councils’ ambitions are hamstrung by central Government rules and funding cuts, meaning they are able to contribute less than 2% of London’s new homes per year.

Since 1980 some 306,000 social homes have been sold by councils in London. During the same period, councils have built only 62,000 homes, equivalent to just one in five of those homes sold being replaced. Figures also show that London councils built just 2,100 homes over the last seven years, including 300 that were completed last year.?

Alongside offers of greater expertise and flexibility over funding, the Mayor is offering councils the opportunity to bid for grant funding at a special rate, the first time this has been done, which will allow them more easily to offer new homes based on social rent levels.

The first deals under the programme have been agreed with three councils. Waltham Forest plans to start 525 new council homes with £26 million of funding from City Hall over the next four years, while both Newham and Lewisham have each committed to starting 1,000 new council homes by 2022.

‘I grew up on a council estate and I know first-hand the vital role social housing plays in London. Council homes for social rent bind our city together, and they have been built thanks to the ambition of London’s councils over many decades,’ said Khan.

‘Back in the 1970s, when I was growing up, London councils built thousands of social homes, providing homes for families and generations of Londoners. But the Government has turned its back on local authorities, severely hampering their ambition to build by cutting funding and imposing arbitrary restrictions on borrowing,’ he explained.

‘I am proud to launch Building Council Homes for Londoners, the first ever City Hall programme dedicated to new council housing. I want to help councils get back to building homes for Londoners again, and I’m doing that with support from the £1.67 billion fund I secured from government to help get 10,000 new homes underway over the next four years,’ he pointed out.

‘I am offering councils expertise and resources from City Hall to scale up their homebuilding programmes, and I will help them to replace homes sold through Right to Buy. The Government is failing to enable councils to replace the hundreds of thousands of council homes sold through Right to Buy, and so I will do all I can to help councils replace as many of them as possible,’ he added.

According to Waltham Forest Council Leader, Clare Coghill, the money will give a massive boost to the number of council homes it can build, helping to reduce the thousands of people on the housing waiting list.

The Mayor of Lewisham, Damien Egan, welcomed the announcement. ‘Lewisham is committed to building new and genuinely affordable council homes in our borough with stable and secure tenancies. We will deliver 1,000 more new social homes in Lewisham, which is just one part of our wide ranging approach to tackling the housing crisis,’ he said.

But more needs to be done by central Government, according to the Mayor of Newham, Rokhsana Fiaz. ‘This proposal to allow councils like Newham rather than central government to keep the money collected from Right to Buy and spend it on social housing is an extremely helpful first step. It allows us to try and address the problems the failed Right to Buy policy creates in reducing affordable social housing,’ he said.

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