An estimated 277,240 new housing units are to be created in London over the next decade but demand will outstrip this figure by 48 per cent, according to new research.
According to a new report by Knight Frank, which for the first time analyses upward revisions to government household growth forecasts, the capital holds a property pipeline with a sale value of £80bn.
But the 40 per cent rise in new households in London between 2011 and 2021 – a total of 525,790 – will far outstrip the 277,240 new homes built.
This is despite an uplift of 63 per cent in 2012 compared with 2011 in the number of housing units granted planning consent annually.
Commenting on the launch of the London Calling – London Residential Development Report 2013, Knight Frank head of UK residential research Gráinne Gilmore said there was “widespread recognition of the housing shortage in the capital”, but that the mayor was “pushing hard” to bring forward new projects.
“While it is impossible for us to second-guess developers about when they will bring schemes forward, our judgements on schemes within the planning pipeline show that overall delivery will not match demand,” he said.
“However, we are not discounting ‘oversupply’ in some local areas – with delivery outstripping local demand as measured by our data.”
The London property market has generally outperformed the rest of the UK, with prices in prime central climbing 60 per cent since the post-crisis dip.
However, the number of private residential units built in the capital dropped by nearly a third at the peak of the crisis between 2009 and 2010.