Political commentators acknowledge that new London mayor Sadiq Khan won the battle to take over from Boris ‘Bike’ Johnson on the back of some bold policies on housing.
Before the mayoral election, the Labour Party politician said that renting a home in London is more expensive than staying in a four-star hotel in many European capital cities, including Paris, Rome, Berlin, Warsaw and Prague.
Khan’s campaign team says the average rent in London is £1676 per month – or £55 per night.
The new mayor, who stood down as Labour MP for Tooting on 10 May, has also suggested it is cheaper to buy a private island in the sun than to get on the property ladder in the capital.
To address these issues, Khan has a 10-point action plan…
- Switch conversions of affordable rent homes back to social rent
- Refuse planning permission for developments that have separate entrances for private and social tenants
- Set up a New Homes Team in City Hall that would act as a developer of new homes for social rent, London Living Rent and first-time buyers
- Introduce a 50% affordable housing target for any new development
- Use mayoral planning powers to prevent buy-to-leave housing and put first-time buyers and local tenants first
- Invest unspent cash in the London Affordable Homes Programme and develop ‘London Home Bonds’ and pension fund investments
- Bring forward more land owned by public bodies like Transport for London for development, and work with boroughs to identify all available brownfield land in public and private ownership that is suitable for development
- Introduce London Living Rent, with rent linked to a third of average incomes
- Set up a London-wide not-for-profit letting agency
- Campaign for the power to limit rent rises
Khan’s property plans centre around “seeking out new sources of investment and using planning powers effectively to raise the number of new and affordable homes London builds”.
But with an average of 19,571 homes per year built under Ken Livingstone and 18,364 per year under Boris Johnson, many question whether mass housebuilding can be achieved.
Christine Whitehead, a professor in housing economics at the LSE, has said that Khan’s housebuilding target would “result in an initial fall in development activity and would make many sites financially unviable”.
The new mayor’s policies could, however, impact the redevelopment of West Ham United Football Club’s former Upton Park home.
It has been reported that more than 25% of the 842 new flats planned for the east London football ground will be affordable, and could be subject to Khan’s living rent policy.
But City Hall’s housing policies will have very little – if any – effect on the property market in Belgravia or other areas of prime central London that Best Gapp operates in.
Developments of the size planned for Upton Park or Nine Elms in Battersea are unlikely to take place in Knightsbridge, Chelsea, Pimlico, South Kensington, Mayfair and Westminster because these exclusive areas of the capital are subject to the strictest of building controls.
The luxury property market in Belgravia, for example, will continue to be dominated by factors outside the mayor’s jurisdiction. These include London remaining a centre for international investment and a dire shortage of quality homes for sale.
This means that residential property in prime central London will continue to attract the attention of high net worth investors for long after Sadiq Khan’s initial four-year term as London mayor comes to an end in 2020.
To discover the value of your prime central London home, contact Best Gapp today for a free market appraisal of the property.