London’s housing crisis, solved?
There's actually been some good news for those renting and buying in London
Morning — a big week for London’s renters and buyers. New protections for tenants, affordable housing targets “smashed” and there’s even talk of building on the green belt around London. Dare we hope the capital could get easier to live in? We’ve gathered some experts to unpack what it all means after your Thursday briefing below.
Plus: late-night sausage rolls are coming to the West End, while a new mayoral candidate has thrown their hat in the ring.
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What we’ve spied
🌭 Greggs has won the right to open a late-night bakery in Leicester Square. Last year the company was barred from opening a 24-hour flagship store in the West End amid claims it would become a “hotspot for late-night disturbances and antisocial behaviour”. Greggs has now reached a compromise with Westminster council that will see the store open until 2am from Thursday to Saturday and until midnight through the rest of the week.
🥀 Legal threats are being thrown at estate residents in Greenwich, ordering them to clear their front gardens. More than 1,500 people have signed a petition in support of those living at Vanbrugh Park Estate, who’ve been told by Greenwich council they have to get rid of pot plants, benches and other items in their outdoor space due to fire risks. The council’s said the Grenfell Tower disaster means it now has a legal duty to clear the spaces.
🗳️ A new London mayoral challenger appears: Daniel Korski, David Cameron’s former advisor turned tech entrepreneur. He’s written in the Telegraph this week to announce his bid to be the Conservative candidate to take on Sadiq Khan in next year’s election. His big idea is a new tax on tourists when they stay in London hotels, to pay for more police on the streets. The Tories are announcing their chosen candidate by the end of July — why not check out our recent issue where we profiled all the runners and riders.
💰 And speaking of taxing tourists — there’s potentially a U-turn coming on the UK’s wider tourism tax, amid warnings it’s making London lose out to cities like Milan and Paris. London’s luxury industry gathered at a summit on Monday and called for chancellor Jeremy Hunt to bring back tax-free shopping for tourists, which was recently scrapped at a Budget.
👮 The Met continues to grapple with the fallout from its Coronation arrests. Officers have been speaking to MPs as part of a committee inquiry, with the force’s assistant commissioner insisting no political pressure led to it detaining anti-monarchy protestors. Meanwhile, a disciplinary hearing is underway for one of the officers who investigated flashing allegations made against Wayne Couzens before he murdered Sarah Everard.
🕳️ An enormous sinkhole, measuring 20-foot across, has emerged above a tunnel built for the HS2 rail line into London. Its sudden appearance has prompted anti-HS2 campaigners to call for an end to all tunnelling for the project, though that seems unlikely. The sinkhole itself is in a field in Little Missenden, a village just outside of London that just so happens to be in the path of the Chiltern Tunnel, which is set to ferry HS2 passengers between London and Crewe. A spokesperson for HS2 has blamed it on “pre-existing ground conditions”.
🎈 Dozens of hot air balloons will fly across the city on Sunday as part of the Lord Mayor's Hot Air Balloon Regatta, weather permitting. The event was cancelled in 2020 due to Covid and cancelled again in 2021 and 2022 due to bad weather, so don’t hold your breath. The Spy has seen a video of the 2019 event, and it’s a bit of a spectacle. One of the hot air balloons was shaped like a lion and another, er, a Wellington boot. It’s all kicking off bright and early from 5.30am. If you’re especially keen, you can keep an eye on their website for weather updates.
🖊️ Three festivals for your diary in London this week. First is the London Hot Sauce Festival on Saturday in Peckham, from 11am to 7pm. The London LGBTQ+ Stand-up Festival kicked off on Wednesday and continues with 10 more nights of comedy at venues across the capital until June 11. Finally, Saatchi Gallery is hosting a rare book fair from Friday to Monday.
🎭 Tough luck to anyone who tried and failed to get tickets to the new Macbeth coming to London starring David Tennant — it sold out nearly instantly. Donmar Warehouse has set up a mailing list for future ticket releases. Still tickets on the door for Ruth Wilson’s slightly mad 24-hour play at the Old Vic on Friday though, if you’re desperate for some celeb theatre.
Three new things in London’s housing crisis
It’s not often we get reasons to be cheerful about renting or buying in London. Lucky us — we appear to have had three in a week.
On Monday mayor Sadiq Khan announced London has hit a major affordable housing target. On Tuesday Labour leader Keir Starmer said he’ll make it easier to build on protected land around London. On Wednesday the government published plans to give new rights to tenants.
Quite the dazzling array of solutions to London’s housing crisis, no? Before getting ahead of ourselves, we’ve gathered some experts for their takes on each. Let’s start with the big news for renters.
More protections for tenants?
The main takeaway for renters in London is that the government is banning landlords from evicting tenants with no justification — known as no-fault evictions or Section 21 notices. For years campaigners have argued they’ve been used in retaliation when tenants try to renegotiate a rent rise or ask for repairs. Morenike Jotham, who lives in Streatham, told the BBC she tried to challenge a rent increase from £550 to £700, pointing to boiler issues, faulty pipes and a mouse infestation. The landlord responded with a Section 21 notice and she was forced out.
Plus there are quite a few other new rights for tenants in the proposals:
A ban on landlords refusing tenancies to families with children or those on benefits
The legal right for tenants to request to keep a pet in their home
An end to arbitrary rent review clauses that allow rent to be raised more than once a year
Doubling notice periods for rent increases
It’s not all about cracking down on landlords though, since they’ll also be getting some perks. Under the plans, landlords will get more powers to evict tenants for antisocial behaviour or falling behind on rent. There are also measures to speed up court possession hearings.
But all that’s actually happened so far is the government has just published these plans, in the form of a bill that MPs will soon vote on. It’ll almost certainly pass, even if a few disgruntled Tory rebels are threatening to vote against it. There’s still a chance the plans could be tweaked though as it makes its way through Parliament. The rough expectation is that the new laws will come into force in the latter part of this year or early next.
Two takes for you — first from the London Renters Union (LRU), which advocates for tenants across the capital. It told the Spy that though abolishing section 21 is “a huge step forward”, it still fears landlords could effectively force evictions “through the backdoor” — for instance, by hiking rents by an astronomical amount.
“There is nothing in this bill banning the huge and unfair rent increases our members are facing all of the time,” said Siobhan Donnachie, spokesperson for the LRU.
“For the many families struggling with housing costs at the moment, a 20% rent hike is simply a 'no-fault' eviction under a different name. If the government is serious about bringing renters security in our homes, it must recognise how insecure renters feel speaking out against unsafe housing or planning for the future with the threat of inflation-busting rent increases hanging over our heads.”
Landlords have reacted to the plan by warning they “lack detail”. Speaking on behalf of the National Residential Landlords Association, Ben Beadle said: “Responsible landlords need to be confident that when Section 21 ends, where they have a legitimate reason, they will be able to repossess their properties as quickly as possible.
“Without this assurance, the bill will only exacerbate the rental housing supply crisis many tenants now face.”
More affordable housing?
This week began with much fanfare, courtesy of Sadiq Khan, who delivered a speech at a construction site on Monday to announce London had “smashed” its target for affordable housing.
The context: a couple of years ago, the mayor negotiated a deal with the government for extra cash to fund more affordable housing in the capital. The target set in exchange was 116,000 more homes — and new data now shows London met that. Kind of. The key thing is the figures are for homes that have been started between 2015/16 and 2022/23. Only around 60,000 have been actually completed in the same period. But as Khan has pointed out, ‘starts’ is what the government target specified, so he’s at least won on that technicality.
But there’s an obvious question: what does ‘affordable’ even mean, especially in London? There’s the bog-standard definition of 80% of market value. But to make things just a bit more confusing, Khan has thrown his own definition in the mix, “genuinely affordable”. It’s a catch-all phrase that covers a lot of schemes in the capital.
Excuse the jargon overload, but there’s:
Social rent, which is basically traditional council housing
Shared ownership, where people pay both a mortgage and rent to part-own a home
London Living Rent, housing for middle-income Londoners who want to build up savings to buy a home – usually rent is around 67% of market value
London Affordable Rent, which is one step more affordable, for households on low incomes, and is about £50 or £60 more expensive than social rent a week
"The whole affordable regime is, I think, purposefully confusing in a way that kind of helps to mask what's really happening,” said Dr Joe Penny, a lecturer in global urbanism at University College London, in conversation with the Spy.
“Politicians will come out and use all these different kinds of terms that, depending on what exactly they mean, can be accurate.”
It’s Penny’s view that many of the above schemes aren’t really affordable at all — a better option would be defining it as a third of a Londoner’s income. But in any case, he says Khan’s new numbers ultimately fall short of what London needs. That’s based on a major City Hall study of London’s affordable housing from 2017, known as the Strategic Housing Market Assessment, which found 31,000 low or social rent homes were needed a year.
“If they were going to meet their own strategic housing market need, they should have built 217,000 [since 2016]. So, you know, they're covering about 27% of what's needed — less than a third. Yeah, so we're miles away from where we need to be."
He adds: "[Khan] has improved on the last mayoralty in terms of affordable housing. I think it is a good thing that he's pushing this idea of genuinely affordable housing. But at the same time, the real issue here is that we're miles away from actual genuine need. And the numbers that are being promoted are not net new homes either because of the socially rented homes that have been demolished. Some of them are new homes, some of them are replacement homes.”
More building on the green belt?
There’s been one last housing bombshell this week: Keir Starmer says he’ll allow more homes to be built on the green belt land that encircles London. In an interview with the Times, the Labour leader says if he’s elected he’ll relax planning restrictions and give councils and residents the power to build on the green land if they see fit.
That’s sacrilege to some, but to others a big solution for London’s housing crisis. The green belt is a special planning designation for swathes of land in England, mostly around the country’s biggest cities. These belts can be pretty huge — London’s green belt is three times the size of the city itself, beginning in the outer boroughs and stretching out to places like Watford, Guildford, Sevenoaks and Basildon. The green belt designation was brought in decades ago to halt urban sprawl and now acts as a barrier to new housing developments.
What winds many up about the green belt is it’s not strictly an environment designation — it’s completely separate from those kinds of land categories like National Parks or Areas of Outstanding Natural Beauty. And there are definitely a few sites classed as ‘green belt’ in London that feel odd — like this car wash in Tottenham Hale that did the rounds on Twitter after Starmer’s announcement.
There have been some predictable reactions to Labour’s plans — from what Starmer would probably describe as “blockers”, not “builders", in his language to the Times. The London branch of the Countryside Charity responded to the plans by calling it the “worst possible option” for the city with a big list of 10 reasons why, including loss of green space, more carbon and dependence on cars. The charity makes the comparison to Los Angeles which, in the 1940s, was about the same size as London. But without a green belt, LA sprawled to an extent that, if overlaid on London, would stretch from Cambridge to Brighton.
But Anthony Breach, a senior analyst at the think tank Centre for Cities, is among those who think it could be huge for London. “It’s a really positive move, and exactly the debate we need to be having if we are serious about ending the housing crisis,” he told the Spy
“I am personally very optimistic that planning reform will occur at this point, and Starmer’s comments are proof that the evidence and political arguments of those who are trying to end the housing crisis are winning.”
Breach’s research at the Centre for Cities suggests a wave of building on the green belt could make London housing cheaper — though it would need to be a huge expansion.
“It would help stabilise house prices and bring down rents, like planning reform is doing in New Zealand,” he said.
“We would need a noticeable increase in stock for costs to noticeably go down – we have calculated that the UK is missing about 4.3m homes (15 per cent) from its national housing market compared to other European countries, and London being so expensive would likely need a bigger percentage increase in stock than 15 per cent to make a big dent.”
And with no building on the green belt?
“If we decide we’re going to protect all of the green belt, then if we want to improve housing outcomes in London we need to be prepared for really radical change in the built environment of the city — demolition of large swathes of the suburbs and most Londoners living in mid and high-rise flats would be a requirement.
“It’s not physically impossible and we should redevelop parts of the suburbs, but it would require more profound change to London than releasing bits of the green belt that are suitable for new homes.”