London is set to receive £11.7 billion over the next decade to support the delivery of affordable and social housing, marking the capital’s biggest ever housing settlement.
The long-term agreement, announced by the Government under its new £39 billion Social and Affordable Homes Programme, allocates nearly 30% of the total funding to London.
The deal also includes a suite of policy reforms long requested by City Hall, including a move towards rent convergence, a 10-year social rent deal, and new flexibilities allowing local authorities to combine Right to Buy receipts with grant funding to better protect and replenish council housing stock.
The funding package aims to build on what City Hall describes as a strong record of housing delivery in the capital.
AFFORDABLE HOMES
In 2023 alone, more than 25,000 affordable homes were started – reportedly the highest number since Greater London Authority records began.
London also recorded a 70% rise in affordable housing starts last year, alongside the highest number of completions at social rent levels in over a decade.
The Mayor’s team credits this momentum to planning interventions that have driven affordable housing contributions in major developments up to 42%, as well as renewed efforts by boroughs to ramp up council housebuilding. Khan has committed to a further goal of delivering 40,000 new council homes by 2030.
AFFORDABLE HOMES BOOST
Mayor of London Sir Sadiq Khan (main picture) says: “This is the biggest and longest [housing settlement] the capital has ever received, and includes proposed policy reforms which I’ve been calling for to help boost the delivery of social and affordable homes in London.
“I want to thank the Deputy Prime Minister Angela Rayner for recognising the scale of the challenge and the opportunity.
“After 14 years of underinvestment and indifference towards social and affordable housebuilding under the previous Government, London now has a chance to deliver more of the homes Londoners desperately need as we work to build a better, fairer London for everyone.”
LONG WAY TO GO
And he adds: “This is a significant step forward. But there’s still a long way to go. Continued investment in transport and housing will be essential to ensuring we meet London’s full housing need.”
The announcement marks a break from what Khan described as “the disastrous legacy of the previous Government,” citing years of underinvestment, Brexit-related disruption, and high construction costs that have hampered housebuilding efforts across the UK.
However, City Hall also warns that London’s housing crisis remains far from resolved. Khan reiterated calls for additional central government support, particularly in transport infrastructure, to unlock thousands of new homes.
