PRESS RELEASE : Mayor of London defies economic headwinds to deliver another jump in housing starts [February 2023]

The press release issued by the Mayor of London on 13 February 2023.

• Affordable housing starts in London up more than 50 per cent on 2021/22
• 900 more affordable homes were completed in the financial year to December 2022 than in same period last year
• Strong delivery comes despite huge challenges for the construction sector, with spiralling inflation, supply chain disruption and an anticipated downturn in the property market

The Mayor of London, Sadiq Khan has thanked the capital’s councils and housing associations for delivering another impressive increase in affordable homes starts, despite an unprecedented range of economic challenges.

New figures from City Hall released today show that 3,698 homes funded through the Mayor’s Affordable Homes Programme were started from September to December 2022. These took the total number of starts for the financial year to date to 6,877. This is a more than 50 per cent increase on the total number of homes built by this point last year when Sadiq went on to achieve the highest number of starts since City Hall records began.

5,360 genuinely affordable homes were also completed in the year to the end of December, nearly 900 more than in the same period last year.

These impressive figures have been delivered despite the ongoing disruption and delays caused to the construction industry by the combined effects of the pandemic, Brexit, and the invasion of Ukraine, which have disrupted supply chains, resulted in a labour shortage and led to soaring construction costs. Government data shows that the cost of construction materials rose by 11 per cent between December 2021-2022, and are up 42 per cent since January 2020. The Government’s ‘mini budget’ last Autumn also contributed to higher mortgage costs, dampening buyer demand for new-build homes.

Homebuilding statistics are always back-weighted with an increased number of starts in the spring. To be ahead of last year’s record-breaking totals at this stage is a testament to the hard work and dedication of London’s councils and housing associations buying into the Mayor’s ambitious vision to deliver the homes Londoners so desperately need. The building of genuinely affordable homes is now underway across London with every borough reporting new starts in the last financial year.

These latest figures are part of a huge increase in council and affordable housebuilding under Sadiq Khan. Council homebuilding last year hit the highest level since the 1970s, and overall affordable housebuilding was more than double the level achieved in the previous Mayor’s final year. Nearly 10,000 homes started in the previous financial year are at social rent levels – the highest annual figure in the last decade.

The Mayor of London, Sadiq Khan said: “Despite strong economic and political  headwinds battering the construction sector, we are once again showing that we can and will put Londoners first by building the genuinely affordable homes they so desperately need.

“Since I became Mayor, council homebuilding in London has hit its highest levels since the 1970s and overall affordable housebuilding is at the highest level since City Hall records began.

“I would like to thank London’s councils, housing associations and our capital’s wider housing sector for their efforts in helping us to continue building a better, fairer London for everyone.

“However, in order to continue making progress the Government must now provide the additional funding we need to safeguard housing delivery in the capital.”

 Geeta Nanda OBE, G15 Chair and Chief Executive of MTVH, said: “Not-for-profit housing associations are working hard to deliver the genuinely affordable homes London needs, alongside investing around £1billion each year in the existing homes we provide. The latest figures on the delivery of new homes are a testament to the commitment we have to tackling the housing crisis, and the strong partnerships we rely on with the Mayor and local authorities across the city.

“There is no doubting the massive challenges providers face, such as rising costs and challenges like building safety. That’s why it’s important that the government continues to support the building of much-needed genuinely affordable homes in London, and across the country.”