The London Councils have emphasized the need for more investments to resolve the housing crisis in the city. The Councils have acknowledged the role played by the boroughs in bridging the demand-supply gap in housing by delivering new homes. The Councils have also recognized the contribution of the private sector in stabilising the housing market. However, the Councils are of the view that focused investments are needed from the long-term perspective.
Greater freedom, relaxation of rules on borrowing and improving the pace of decision-making are some of the actions that the London Councils are proposing to the local authorities.
It is evident that the local authorities now enjoy the liberty of managing their housing stock by borrowing against their existing housing assets to build new homes. But their borrowing within the Housing Revenue Account is restricted by the Treasury. Besides, the rules on the reinvestment of right to buy receipts and restrictions on general fund investment have impacted the housing sector. As a consequence, the number of new homes coming to the market from the local authorities is nowhere near the demand.
The London Councils have been arguing in favor of the local authorities for relaxation on rules pertaining to borrowing for housing. With London continuing to remain among the top financial markets of the world, the role of London Councils is critical to meet the housing demand.
London’s councils are now responsible for around 400,000 homes. Following recent reforms, they now have the freedom to manage their housing stock through self-financing