The recently assented Housing Act means that haggling for affordable homes is going to get even harder. The government will now expect around 20% of all new developments to include starter homes. These will be instead of affordable homes, but will be for sale at 80% of market value rather than for rent. Such a policy could wipe out rented affordable housing in many places.
And what, finally, of preventing the foreign buy-up of new homes? Khan attackedtheir use as “gold bricks” by investors on Wednesday, but could he go further than his proposal to insist that they are marketed to UK buyers only for the first six months, and block them from buying altogether?
“In London, many potential buyers are from overseas, and if you prevent them from buying, demand would fall significantly,” said Lee. “The impact would depend on the extent to which UK buyers have sufficient funds to purchase properties at the prices being sought. If they don’t, there would be a significant drop in house prices, particularly in central London. Take out foreign buyers from central London and you pull the rug from under the market.”
Reversing the steady decline in London’s cheap housing stock, fending off buy-to-leave investors and delivering some good news on affordability to a population gobsmacked by stories of empty multi-million pound flats such as those at the Tower looks set to be Khan’s hardest job.