London desperately needs new homes: 60,000 a year to be exact, according to research by real estate company Savills.
This means that the city is drastically lagging behind where it should be in terms of breaching the chasm between supply and demand for housing. Closer to 30,000 homes were built in the capital in 2015.
Looking forward doesn’t paint a prettier picture either – in fact, according to forecasts by Hewes & Associates, construction output in the capital is expected to decline by 6.6 per cent in 2017 and 3 per cent in 2018, with a slowdown in the residential market the main factor.
And with Redrow washing its hands of developing in central London, warning of the “real challenges” of building in the capital, it begs the question: How can we solve the housing crisis in the city if no one is willing to put the bricks down?
Enter stage right: SME housebuilders.
In the words of Home Builders Federation deputy chairman Peter Andrew, who spoke at a National House Building Council event last month, we need “more players on the field” when it comes to delivering more housing.
And speaking today, deputy mayor for housing James Murray said there was no one delivery model when it came to approaching the housing crisis.
He said: “If you want to increase supply… you need different tenures, different delivery models to challenge the assumptions about how you deliver housing.”
Plenty of room, then, for SMEs to develop on smaller sites; but we are still likely to need those heavyweight housebuilders to deliver big chunks of housing in the capital.
Perhaps another creative solution to solving the housing crisis in the city could be for Londoners to hug a housebuilder?
Also in the news:
Galliford Try’s construction arm has seen operating profit drop by two-thirds in its financial results for the last six months of 2016.
Housebuilder Bovis will look to cut back on housing completions but expand its supply chain in 2017, according to the company’s chief executive.