The London property market is in crisis with “nothing like enough new homes being built”, forcing the government to water down targets for affordable housing, the cabinet minister in charge has told Sky News.
Steve Reed, the housing secretary, and Sir Sadiq Khan, the Mayor of London, made a major intervention in the housing market today with a package to reduce red tape introduced post-Grenfell for developers and slash the target for affordable homes from 35% to 20%.
Both men sat down with Sky News for a rare joint interview to justify the decisions, which represent a significant U-turn from the Mayor of London, who has previously made the affordable housing target a central part of his re-election campaigns.
Mr Reed justified the decision to slash the affordable housing target – which will be opposed by Labour MPs and charities – on the grounds of “35% of nothing is nothing”.
New figures show the scale of the housebuilding collapse in London. The government set a target in the first nine months of this year for 66,000 new homes to be started in London, but to date, there have been just 3,200 private starts, according to the analyst Molior London.
The housing secretary was frank that the government needs to get greater incentives for housebuilding.
“We need to make schemes viable for developers so they’ll get spades in the ground and start to build them,” he said.
Affordable housing target not to blame
However, Sir Sadiq did not appear to accept that the affordable housing target itself was the cause of the collapse in housebuilding – something regularly claimed by property developers.
He said that the cause of the worst collapse in housebuilding since the 2008 financial crisis was elsewhere.
“The price of concrete has gone up by more than 50%. The price of steel has gone up more than 40%,” he said.
“In London, 96% of new builds are…
