The low supply and high demand in London’s crazy property market is a source of perpetual debate and annoyance to many living in the capital.
Now, just over six months before he leaves the mayor’s office, Boris Johnson might have come up with a solution to the problem: go east.
New York City is facing similar problems, as it competes with other global gateway cities like London as a “safe haven” for investors. New York is catching up to London and Hong Kong, its two biggest global competitors, in terms of prices.
On Thursday, the mayor’s office unveiled plans for what it calls the “City in the East” and it could create in excess of 200,000 new homes, something that would go a long way to solving the housing crisis plaguing London right now.
The Mayor’s plans came on the same day that Foxton’s, the often maligned estate agent, announced in a trading update saying that it has seen transactions fall to all-time lows, likely because of properties being largely unaffordable in the capital.
The crux of the Mayor’s development strategy eastwards from London Bridge out as far as Dartford in Kent, 15 miles east of the city centre. They include developing and redeveloping areas like the Isle of Dogs and the Greenwich Peninsula.
Of the 200,000-plus new homes, over 30,000 would be built in the area surrounding the Olympic Park, and another 20,000 could go up in the Lee Valley area.
Alex Williams, Director of Borough Planning at TfL said on Thursday “East London is expected to be one of the largest growth areas in the capital, with the population set to increase by 600,000 in the next 15 years.” Increasing populations obviously increase the need for housing and just 28,733 new homes were built in Greater London in 2014, according to the National House Building Council.
Considering this, building another 200,000 in east London would clearly help alleviate some of the tightness in London’s housing market. It should be noted that no timescale has been put on the entirety of this project.
The new plans from the Mayor’s Office aren’t entirely new, and actually bring together a large number of developments that are already in progress. These developments are known as Opportunity Areas, and are brownfield sites which are said to have “significant capacity for new housing, commercial space and other development.”
BoJo’s announcement wasn’t all about building houses, and the Mayor also said that the proposed projects might create more than 250,000 new jobs, and huge amounts of new infrastructure.
An extension of the London Overground to Barking Riverside, as well as a brand new station, and a new tunnel for the A13 road are among the ideas that he touted. The Barking extension would enable another 10,000 homes to be built, and if the mayor’s plans get the go ahead, could be done by 2020.
Johnson’s estimates about new housing far outstrip those previously made by the mayor’s office while it was occupied by Ken Livingstone. In 2004, it was thought that a max of 52,000 new homes could be built in East London.
Speaking about the plans on Thursday, the mayor said “East London is already enjoying incredible growth and the ‘City in the East’ plans reflect how we make the area an even better place to live and work over the next 20 years.”
No costs were announced for any of the plans.