London gets 35% affordable homes target - but unclear how starter homes will fit in

A senior manager working under London mayor Sadiq Khan has admitted it is possible developers may have to provide starter homes in addition to meeting the capital’s new 35% target for affordable housing on projects.

Yesterday Khan published much-anticipated planning guidance on affordable housing, a week after receiving a massive boost in chancellor Philip Hammond’s Autumn Statement with a £3.2bn cash injection direct to City Hall for affordable housing.

Under the new planning guidance, schemes that provide 35% affordable housing will get a waiver from normal scheme viability checks - which should enable a faster passage through planning.

But it is unclear how the government’s starter homes policy will fit in with this. Earlier this year the government passed legislation mandating that starter homes - which are sold at a discount on the local market rate - should be included in all schemes, although the detail is yet to be hammered out.

More detail on starter homes is expected in a white paper on housing to be published in January.

Colin Wilson, senior manager for the Greater London Authority’s development and projects team, told the Building Live conference the mayor still did not know if starter homes would come under its new remit of affordable housing. He said: “On starter homes, we don’t know. We waited till now to release the SPG just in case the government was going to do something, but they haven’t.”

Wilson was speaking during a panel debate on the future of London development. Fellow panellist Roger Madelin, head of British Land’s major Canada Water mixed-use development, criticised viability assessments to determine the amount of affordable housing on a scheme as “unbelievably stupid” as they attempt to predict profit once a project has been built out.

Madelin said: “It comes from the fact that our politicians as a society have decided we don’t want to subsidise housing from general taxation and I think we should and I think until the government recognises this we’re going to be in a stand-off.”

Madelin did however agree that City Hall’s new planning guidance was a step forward.