London Builders Just Called It Quits
The Home Builders Federation has a message for London: we’re out.
Their latest report doesn’t mince words. London has become a “no-go zone for housing investment.” The numbers back up the harsh language.
London needs 88,000 new homes each year. Last year, builders delivered 30,000. That’s a 66% miss on the target, representing a 12% year-on-year decline.
The Market Has Stopped Working
Planning permissions hit their lowest point since 2006. Construction starts dropped 38% in a single year.
Meanwhile, real people pay the price.
London’s social housing waiting lists reached 336,366 households in 2024. That’s up 32% since 2014.
Over 175,000 Londoners live in temporary accommodation right now. One in every 50 residents. Put another way: every London classroom has at least one homeless child.
The Money Tells the Story
Boroughs spend £90 million monthly on temporary housing. That’s £3 million every day, up 40% from last year.
Why won’t builders build? The economics are brutal.
London ranks fifth globally for construction costs. High-rise apartments cost £4,163 per square meter. Townhouses run £3,280 per square meter.
Add excessive bureaucracy, unrealistic affordable housing requirements, and processing delays that stretch for months.
The result? Developers walk away.
One Bright Spot
Purpose Built Student Accommodation works differently. Since 2021, the sector delivered the equivalent of 10,500 conventional homes through 26,000 student bedrooms.
But student housing can’t solve London’s broader crisis.
The Real Cost
This goes beyond housing. When housing costs rise, productivity falls. City Hall research shows building 90,000 social rented homes would add £51.2 billion to the economy.
London’s housing crisis threatens its position as a global city. Bad policy creates worse outcomes. Housing affects jobs, communities, and competitiveness.
The builders have spoken with their feet.
Until London fixes its policy problems, expect more of the same: fewer homes, higher costs, and a capital that works for fewer people each year.