London’s affordable housing delivery is facing a combination of viability, funding, capacity and process challenges, with a growing gap between homes receiving planning consent and those ultimately being delivered.
Earlier this month, together with LGL, we convened leaders from across the housing delivery system, including developers, investors, Registered Providers, local authorities, the GLA, planning and architecture practices, contractors and other sector advisers. This breadth of experience underscored the need for stronger connections between organisations at different stages of the delivery process, as well as the potential for the GLA to play a greater role in matching developers with suitable partners and helping unlock stalled sites.
The discussion highlighted the scale of the challenge, including rising construction costs, reduced activity among some Registered Providers (RPs), increased reliance on external capital and the cumulative impact of delays across planning, funding and regulatory gateways. While there was recognition of the GLA’s long-term funding commitment and its potential to help derisk schemes, participants questioned whether the current system provides sufficient certainty or flexibility for viable opportunities to progress. There was also a growing case for considering refurbishment and better use of existing stock alongside new-build delivery.
A central theme was the need for developers and RPs to engage much earlier in the development process. The group identified late-stage negotiations, uncertainty around specifications and differing expectations of quality and design as significant contributors to stalled Section 106 delivery. Earlier collaboration can give RPs greater influence over the design of homes, while providing developers with greater certainty that an affordable housing partner will support the scheme. Case studies discussed during the session demonstrated how meaningful engagement can improve outcomes, including schemes where early conversations with councils helped shape layouts and specifications around local needs.
The discussion ultimately pointed towards the need for a more connected and solution-focused approach to affordable housing delivery. Rather than treating planning, funding, development and affordable housing acquisition as separate processes, participants argued for greater coordination between developers, RPs, local authorities, the GLA and government. Practical opportunities include agreeing appraisal approaches earlier, providing greater certainty around funding, reducing unnecessary delays at key gateways, reviewing the diversity of Section 106 processes across London and creating mechanisms that allow RPs to engage before schemes are fully progressed. While the market remains challenging, there was a strong sense that more homes could be delivered if partners were prepared to share risk, engage earlier and explore new models of partnership.
The key message was clear: unlocking London’s affordable housing pipeline will require greater flexibility, confidence and collaboration across the sector.