London boroughs are geared up and prepared, ready to take action, with hardhats in hand, to ramp up housing construction efforts
In a bid to address the growing homelessness crisis in London, the Chancellor, Rachael Reeves, has set out new housing targets and initiatives. These measures are designed to accelerate housing delivery, improve planning efficiency, and increase the supply of affordable homes in a city facing severe housing pressures.
London is currently grappling with a significant downturn in new housing starts and registrations. The complex planning system, new building safety regulations, and low activity from housing associations have contributed to this decline. For instance, new home registrations in London more than halved between Q2 2024 and Q2 2025.
To tackle these bottlenecks, the government aims to establish a specialized taskforce that will provide focused leadership to speed up construction on approved sites. A chronic problem where 30-40% of planning permissions expire without development is a major concern. Investment in council planning officers is also expected to improve local authority capacity, enabling them to manage planning applications efficiently, enforce development timelines, and apply powers such as compulsory purchase or penalties on delayed homes.
These interventions align with broader efforts, including planning reforms to unlock development on green belt and brownfield land. Given the acute demand for social and affordable homes, particularly in London, targeted funding combined with stronger planning enforcement should boost the delivery of affordable housing, mitigating homelessness risks by increasing supply.
London Councils have recognised that boroughs can help boost housing targets by performing comparatively well when making decisions on major planning applications. However, they have expressed concerns about insufficient development capacity, especially in the public sector, acting as a barrier to growing the housing supply.
Cllr Claire Holland, deputy chair of London Councils, stated that boroughs are pro-housing growth and welcome the Chancellor prioritizing this issue. Boroughs have a good record in supporting housebuilding and in granting planning permission, but they are keen to go further in ensuring more homes get built, more quickly.
Despite these efforts, challenges remain. A shortage of skilled construction workers and skyrocketing construction costs have exacerbated the funding issue. Available sites require remediation and infrastructure investment to unlock housing supply.
Over the last two years, 88% of major planning applications across England and 93% in London were approved within 13 weeks or within an agreed time period. However, the acute demand for social and affordable homes, coupled with the city's scarce and expensive land, necessitates a comprehensive approach to tackling the housing crisis in London.
References:
[1] London Councils. (2025). Chancellor's Housing Announcement: London Councils' Response. [Online] Available at: https://www.londoncouncils.gov.uk/media/10961/chancellors-housing-announcement-london-councils-response.pdf
[2] Mayor of London. (2025). Mayor of London Welcomes Chancellor's Housing Announcement. [Online] Available at: https://www.london.gov.uk/press-releases/mayor/mayor-london-welcomes-chancellors-housing-announcement
[3] London Assembly. (2025). London Assembly Questions Mayor on Housing Delivery. [Online] Available at: https://www.london.gov.uk/assembly/mayor-questions/2025/05/london-assembly-questions-mayor-on-housing-delivery
- The new housing targets and initiatives proposed by Chancellor Rachael Reeves concerning policy-and-legislation can be seen as a response to the general-news issue of the growing homelessness crisis in London, particularly the significant downturn in new housing starts and registrations.
- The government's interventions, such as the establishment of a specialized taskforce and investment in council planning officers, are intended to speed up construction on approved sites and improve planning efficiency, addressing concerns about the chronic problem of expired planning permissions, a major factor hindering housing delivery in London.
