Opinion

Peter Apps: London builds fewer homes than in any recent decade while rents pass £2,200

The deficit is a planning choice not destiny and the 1970s show the city knows how to fix it

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Famous Grand Designs water tower home in London on the market for £2.75m after staggering price cut Famous Grand Designs water tower home in London on the market for £2.75m after staggering price cut standard.co.uk
<p>A photograph taken on February 25, 2025 shows an aerial view of the Elizabeth Tower, commonly known by the name of the clock's bell "Big Ben", and the Palace of Westminster, home to the Houses of Parliament, taken from inside a London Eye capsule, in central London. Floating high above the London skyline aboard her most famous creation, architect Julia Barfield said she never expected the London Eye to take off as a design icon. The initial priority was finding a breathtaking way to see the city, she told AFP in an interview inside one of the giant ferris wheel's 32 glass pods, now drifting against the backdrop of the Houses of Parliament. (Photo by HENRY NICHOLLS / AFP) (Photo by HENRY NICHOLLS/AFP via Getty Images) </p> <p>A photograph taken on February 25, 2025 shows an aerial view of the Elizabeth Tower, commonly known by the name of the clock's bell "Big Ben", and the Palace of Westminster, home to the Houses of Parliament, taken from inside a London Eye capsule, in central London. Floating high above the London skyline aboard her most famous creation, architect Julia Barfield said she never expected the London Eye to take off as a design icon. The initial priority was finding a breathtaking way to see the city, she told AFP in an interview inside one of the giant ferris wheel's 32 glass pods, now drifting against the backdrop of the Houses of Parliament. (Photo by HENRY NICHOLLS / AFP) (Photo by HENRY NICHOLLS/AFP via Getty Images) </p> standard.co.uk
Chesterton and Dexters estate agents for sale signs are displayed outside a house estate agents in Clapham south west London on August 1, 2024 Chesterton and Dexters estate agents for sale signs are displayed outside a house estate agents in Clapham south west London on August 1, 2024 standard.co.uk
<p>Westminister has the highest number of homeless people dying in London</p> <p>Westminister has the highest number of homeless people dying in London</p> standard.co.uk

London is building fewer homes than it has for decades, and the projection points down. The average two-bedroom rent in the capital exceeds £2,200 a month; a single room can top £1,000. A first-time buyer needs a deposit of £134,000. Roughly 75,000 families live in temporary accommodation — more than double the number at the start of the 2010s, the highest in living memory.

Peter Apps, writing in the Standard, argues the shortfall is a political choice rather than demographic fate. The 2010s demonstrated the mechanism in reverse: demand was high, prices soared, flats sold off-plan and flipped, some sat empty on completion, and many of the buildings from that era carry quality defects. Speculative building delivered price appreciation, not housing.

The decade's other lesson is that the state can move the number when it decides to. At the start of this decade, London councils began the largest council-house programme since the 1970s, backed by the Mayor and new funding rules. Covid and the war in Ukraine raised borrowing and building costs; projects were scaled back or reverted. Labour's new money does not close the gap — City Hall estimates the city needs £4.9 billion a year until 2030 and currently has £3.3 billion.

Private housebuilding has stalled for the opposite reason the 2010s boom did: demand has collapsed under the weight of affordability, and the international investors who once bought London new builds have moved elsewhere. Teachers, nurses, retail and transport staff have moved out of the city in their wake, and the London birthrate is falling.

Apps's proposal is unglamorous: build tens of thousands of social homes, which would let tens of thousands of families out of temporary and private rentals. He also notes models squeezed out by speculative building — community land trusts, of the kind used in Zurich and Scandinavia — survive where housing is treated as a place to live rather than an instrument to hold.

The arithmetic is public and the precedent exists: the city built its way out of worse after the war. What stands between the £3.3 billion and the £4.9 billion is a planning regime that treats construction as damage to be mitigated — and the families in temporary accommodation who pay the difference.