Priced Out? The affordability crisis in London

Article

London’s housing market is increasingly unaffordable for those on low to middle incomes. While it has always been more expensive to rent or buy in the capital, the scale of the unaffordability of housing has never been greater. As a result, today’s Londoners or would-be Londoners face a range of consequences including lower levels of home ownership, increased overcrowding, and rising levels of homelessness and rough sleeping.

Building more homes, particularly affordable homes, will be crucial to tackling the affordability crisis that the capital faces. Yet the evidence shows that housing delivery is falling well short of estimated need – and the provision of affordable housing even more so. Despite a range of products on offer in the capital, the level of intermediate housing to rent and buy to support those on low to middle incomes is extremely modest. Moreover, our analysis reveals that many sub-market home ownership products on offer in the capital are in fact unaffordable and some fail to meet the aim of many households to achieve full home ownership.

The new Mayor of London, Sadiq Khan, has made a promising start, committing to a long-term strategic aim for 50 per cent of new homes to be affordable, introducing lower benchmark rents for the London Affordable Rent product, and introducing a new intermediate product in the form of the new London Living Rent. However, there’s more that can be done at all levels.

Related items

  1. A mother and child from behind looking out of a window

    Restoring security: Understanding the effects of removing the two-child limit across the UK

    The government’s decision to lift the two-child limit marks one of the most significant changes to the social security system in a decade.
  2. A group of healthcare professionals sitting in a staff common room in a hospital in Newcastle

    Building a healthier, wealthier Britain: Launching the IPPR Centre for Health and Prosperity

    Following the success of our Commission on Health and Prosperity, IPPR is excited to launch the Centre for Health and Prosperity.
  3. The Home Office building in London

    A ‘paradigm shift’ in asylum and immigration policy?

    In 2019, a package of asylum reforms known as the ‘paradigm shift’ was passed by a broad party consensus in the Danish parliament.