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London mayor sets out plans to solve housing crisis

The mayor of London has called the shortage of affordable housing in the capital ‘perhaps the gravest crisis the city faces’ in his vision for the future.

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Boris Johnson called for restrictions on London councils to borrow to be lifted so they could build more homes, as he released his plans for the capital yesterday.

‘There is no need for this to appear on the books as public borrowing,’ he said in his paper 2020 Vision - The greatest city on earth; ambitions for London.

He estimated another 1 million homes would be needed by the mid-2030s if London is to cope with demographic projections.

Mr Johnson added: ‘Already 70 per cent of businesses say that the cost of housing in London is a major barrier to growth.’

‘To address this crisis we need to act urgently and boldly,’ he states in his plans.

He also said a London rental standard should be brought in to offer certainty to landlords and tenants to combat ‘punishingly high’ rents.

The mayor pledged to accelerate the programme of releasing City Hall land for development saying the Greater London Authority is working with public sector bodies to create an inventory of what is available.

He also recognised the group that needs the greatest attention is the ‘squeezed middle’. ‘Living in the capital is perhaps toughest of all for working people on modest incomes who are the backbone of the economy,’ Mr Johnson said in the vision.

He again calls for London to be handed the stamp duty that it raises through house sales to help build homes. He estimated this would be about £1.3 billion a year.

‘With stable and continuous funding, we in London would be able to leverage our cash far more effectively, and developers would have the confidence to make long term investments and get big schemes going,’ he said.

Kevin Williamson, assistant director at the National Housing Federation, said: ‘The mayor is right to look for bold solutions to London’s drastic housing shortage rather than short-term fixes – and absolutely right that long-term and stable investment is needed to fix the capital’s housing crisis.

‘But this ambitious vision will only be achieved if we start acting now and the mayor needs to use his already considerable powers and sizable land-bank to get things moving today. If we don’t, the Londoners of 2020 will face first-time buyer deposits nearing £100,000, driving talented workers and striving businesses away from the capital.’

Darren Johnson, green party member of the London Assembly, said: ‘The mayor acknowledges the dire need for affordable housing, but hasn’t set out a budget.

‘He needs £6 billion to build at least 73,000 social rented homes from 2015 to 2020. Last time he took a two-thirds cut to his housing budget and his building programme has been massively delayed. Londoners can’t afford seven more years of lacklustre affordable housing delivery.’

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