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Throughout 2019, political uncertainty and hesitation were overriding factors that influenced several areas of the property and development sector in London and the UK. Despite this uncertainty, work has continued on the Emerging London Plan, which sets out the future direction for development in London.
The end of 2019 saw the London Plan analysed by a panel of Inspectors as part of the examination process. They made several recommendations to Mayor Sadiq Khan, to be considered before the plan can be formally adopted.
One recommendation, which will have a significant impact on future planning, is the reduction in housing target figures, which The Mayor has said he accepts. The Panel recommended a reduction in housing targets by one fifth from nearly 65,000 homes to 52,000 per annum over the plan period (2019-2029). A key component of the Mayor’s housing strategy was to meet 38% of the overall housing target through delivery on small sites. The Panel’s report concluded, however, that they were sceptical about the delivery from these sites. As such, the Panel recommended that the Mayor delete policy H2A regarding small housing developments. The recommendation on small sites has now halved to 12,000 per year, or 119,250 over the ten-year plan period. It should be noted that the Mayor is still supportive of development on small sites and has moved some of the supporting text to enable boroughs to encourage such development, for example, through the proactive use of design codes.
When the Plan is adopted, the housing targets will take precedence over those existing Borough plans, even if recently adopted, with no transitional arrangements in place. While the overambitious target would have seen a number of local authorities struggling to meet housing targets (particularly some of the outer London boroughs) it is expected that the lower target, albeit higher than the existing, will still have significant effects on local authorities and developers.
For local authorities, the lower targets provide them with an opportunity to focus on increasing housing provision, although it remains to be seen if some will have difficulties demonstrating a five-year supply of deliverable housing sites. Housebuilders are said to agree that the reduced target is more achievable and more considered towards external factors and constraints but there is still concern around meeting London’s ongoing housing pressures.
Housing demand in London is a constant factor, so too is the demand for it to be well-located and affordable. It is feared that by slashing the housing target the gap between supply and demand will only keep increasing, leading to a lack of affordable and suitable dwellings for London’s growing population. It is in this context that the Panel’s report leaves several unanswered questions and the implication is that there are not ‘sufficient homes for all’.
If London fails to meet their housing need it puts pressure on neighbouring authorities in the South East to increase their housing targets to make up the deficit. However, given that the duty to cooperate between authorities does not apply in London this would be difficult to enforce on any unwilling neighbours. This, alongside The Mayor’s unwillingness to discuss developing green belt land, could see the gap between housing supply and demand widening.