The mayor of London’s target to build 42,000 new homes a year is not enough to meet a backlog of demand, according to a panel of housing experts.
Greater London Authority housing and land executive director David Lunts added that London’s housing need was closer to 49,000 new homes a year but said the GLA must have evidence that it has sufficient land for the homes.
He added that the GLA target was a “big one”, being double the amount of homes being built to date and admitted that meeting the 42,000 homes target would be a challenge.
But he said: “If you don’t set ambitious targets, you don’t know what you’re aiming for.”
The executive director was joined by Taylor Wimpey chief executive Peter Redfern, Berkeley Group chairman Tony Pidgley and the Department for Communities and Local Government’s private rented sector taskforce head Andrew Stanford at this month’s Movers & Shakers property event.
The panel were debating ways to unlock London’s housing supply, after concerns were raised about a potential housing bubble in UK.
Last month Bank of England governor, Mark Carney, said the BoE could intervene by limiting mortgage types or changing the terms of the government’s two-phased Help to Buy scheme.
Berkeley Group’s Mr Pidgley dismissed the idea of a housing bubble in the UK and supported the government’s extention of the Help to Buy equity loan scheme.
But Taylor Wimpey’s Mr Redfern disagreed with the decision to extend Help to Buy to 2020 and said it should be “tailed off” earlier.
He added that the housing market needed long-term consistency of governance and planning and swift delivery of housing once plans were in place.
“There will be periods of price growth but this will eventually soften. Overall [we need the] framework to stay the same,” he said.
The Mayor of London’s draft housing strategy set a target to build 42,000 homes a year over the next 20 years. However the panel was unsure this level of output could be met soon.
Mr Redfern said the private sector would not deliver this target alone.
Taylor Wimpey will build around 1,000 new homes this year, which would increase to 1,500 by 2017, he said.
Mr Pidgley said public private partnerships and wider infrastructure growth were important to meeting London’s housing target.
He said that major infrastructure projects such as Crossrail could unlock housing developments and that more needed to be done to increase affordable homes in the capital with the private sector required to meet the challenge.
The private rented sector is expected to make up 5,000 of the 42,000 new homes, which PRS taskforce head Mr Standford said was realistic. He said institutional investors had aspirations to invest £10bn of funds into the sector.