Hundreds of additional new ‘affordable’ homes are to be built after Mayor Sadiq Khan extended a funding deal agreed between predecessor Boris Johnson and developers Pocket Living.
The firm builds ‘micro homes’ which are often pre-made off-site and sold to local people at capped prices, typically around 80% of market rate. Future onward sales of the properties are also governed by these restrictions thanks to a covenant attached to them in perpetuity.
In 2013 Johnson agreed a £26m revolving ten-year loan to acquire land and build 1,000 new homes, 277 of which are now complete. Construction on a further 388 is currently underway.
Mayor Khan has now pledged an additional £25m alongside a “re-allocation” of the Johnson money to form a total investment of £51.4m which will fund “at least 1,059 additional affordable housing starts by the end of March 2021.”
However, while not mentioned in City Hall’s announcement, internal documents confirm that Khan’s repackaged deal, unlike the money pledged by the former Mayor, will also fund a number of homes to be sold at full market rates.
Today’s announcement also omits any mention of the existing Pocket Living and City Hall tie-up or the 665 homes being built under it, instead hailing the expanded funding as an “innovative deal”.
In a statement, Mr Khan said: “The housing crisis is the biggest challenge facing Londoners today and I have been honest from the start that we won’t be able to turn things round overnight.
“For decades, we have simply not built enough new and affordable homes in the capital, meaning that for too many Londoners the dream of buying their own home is getting further and further out of reach.
“That is why I am working with Pocket Living to build more than a thousand homes for first-time buyers, using the latest off-site construction techniques to provide attractive and affordable homes as quickly as possible.”
Andrew Boff, the Conservatives’ housing spokesman on the London Assembly, said: “The Mayor’s announcement fails to mention this ‘innovative scheme’ is merely an extension of a £26.4m deal with Pocket Living initiated by Boris in 2013.
“It also fails to mention that not all of the homes built under the renewed agreement will be affordable.
“Once again we are seeing more smoke-and-mirror spin from Sadiq Khan.
“I’ve long been a supporter of modular housing and I welcome additional funding for it.
“I just wish the Mayor would be transparent about what he’s actually doing.”