Affordable Housing: London
Debate between Lord Cryer and Karen BuckWestminster Hall is an alternative Chamber for MPs to hold debates, named after the adjoining Westminster Hall.
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Ms Buck
My hon. Friend is absolutely correct. The result of all the different pressures together, with worse to come, has an impact beyond housing, strictly defined; it is changing the face of London, intensifying housing inequality, and changing the face of poverty and low incomes in London. The typical family in poverty is now, for the first time in modern times, a working family living in the private rented sector in outer London—that takes me back to the point that the hon. Member for Enfield, Southgate (Mr Burrowes) raised. Poverty is being suburbanised and intensified by what is happening in the private rented sector.
All that is bad for London’s economy. There is ample testimony from London First, the CBI and many other organisations that the housing crisis is making it hard to recruit, and is undermining the effectiveness of London’s economy. It is making it hard to recruit and retain staff in the services on which we all depend. However, it is also undermining London’s civic life—the health and wellbeing of the city—as people struggle to cope with the consequences of the housing crisis. Above all, it is bad for individuals—for struggling families and for young people seeking to find a stable home of their own in which to build a life and family.
Inner London is on the front line, because it has the steepest house prices, broadly speaking. How are inner London boroughs such as Westminster coping with that? Very badly indeed, I am sorry to say. Westminster produced just 46 new affordable homes last year. Over the past three years a mere 12% of all the development in Westminster has been affordable. That is less than half of the already appalling 28% London-wide average. That is the pattern across London. Areas with the greatest housing pressures have the worst supply of new affordable homes.
In the weeks before the London mayoralty election—it is no accident or coincidence—a number of new developments were pushed ahead for approval by Westminster City Council. The Whiteleys scheme in Bayswater has 103 luxury flats, just 2% of which are affordable. Paddington Green has 690 flats, 19% of which are affordable. There are other schemes in the pipeline. Westminster City Council is closing and demolishing the Jubilee sports centre—the Prime Place development—and the developer is marketing its properties in the far east before a single one has been built. In fact, it was marketing in the far east before the closure of the sports centre. Figures out this week show that there has been a 9% rise in the number of London properties owned by offshore companies. It is not simply that we are failing to build—although we are—but we are building the wrong properties, in a way that is part of a process of purchasing from overseas by the super-rich.
Developers are private companies and will behave as the Government permit them to do, and as they are driven to do by commercial logic, unless they are encouraged to do something different. They have been going into the luxury housing market. I was struck yesterday by the marketing brochure of the Galliard company:
“In order to keep up with the trend of trophy apartments and to give buyers what they want, developers are creating properties that offer nothing but luxury and indulgence. In fact, Kay & Co have released statistics that show that ‘35% of units under construction or completed in 2014 are in 5* developments.’”
It adds that according to
“Knight Frank’s Global Development Report from 2015, the amount of prime luxury properties…in London”
is up threefold since 2009. So we are building luxury properties, in some of which—such as the Vauxhall Tower—hardly anyone lives. We are building luxury properties that are a sponge for global money and the super-rich; and a not insignificant proportion of that money is dirty money.
John Cryer
Is my hon. Friend aware that in many new developments in central London, the flats—because overwhelmingly they are flats—are not even being advertised in Britain? I do not mean that in a nationalistic sense, but they are being advertised only in areas of the world where there are large concentrations of wealth and power. Does she think we are storing up an awful lot of social and economic problems for future years, if the trend continues?