London mayor Boris Johnson has unveiled plans for a “London Housing Bank” to fund housing projects in the capital. A £200 million fund could potentially accelerate the building of up to 3,000 homes, for low cost rental.
The bank would help activate some of the stalled 200,000 planning consents that have already been granted across the region. There are various reasons why they are not yet built: “Often, this is due to the funding and sales constraints which can limit the pace of building,” says a mayoral press release.
The idea is that the home building could be accelerated. Completed homes would then be offered at a low cost rent, and turned over to market rent in due course. The Housing Bank would be repaid no later than 10 years after investing, through institutional sales.
“We’re doing everything we can to double house building across the capital and address a 30 year failure to build enough homes for this thriving city,” said mayor Johnson. “The proposed housing bank is just one of several highly innovative new schemes we are pioneering.”
Other ideas for the housing bank include the idea of encouraging off-plan selling, and offering funding guarantees. Funding could come from public and private sector investors, it is thought.
The consultation is currently being extended to relevant parties in the industry, with their thoughts required by a 21 May deadline.