Twenty years ago the average house In London cost seven times the average salary – today it costs thirteen times the average salary. This doesn’t just mean people are spending more on housing – homelessness rates have also risen dramatically. Jenevieve Treadwell argues that, contrary to popular perception, there is still plenty of space to build in London. Labour’s Grey Belt proposal could be a way of doing so.
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London’s housing market is the hottest in the UK. House prices rose by 130 per cent between January 2005 and January 2023 and rents in London are the highest in the country. London needs to build more homes to address spiralling prices, but this has proved challenging. Between 2022 and 2023, only about 35,000 homes were delivered, a third of the Government’s target for the city. That’s because building enough housing is hard. This is true in London and across much of the rest of the UK, but London’s situation is made even more difficult as about a fifth of land is protected from urban expansion by the Metropolitan Green Belt (MGB).
Contrary to public perception, there is plenty of space to build in London.
In the last 20 or so years, London’s average affordability ratio has nearly doubled. This means that where the average house once cost seven times the average salary, it now costs 13 times the average salary. For renters, the situation is also bleak. Rent is considered affordable if it costs 30 per cent or less of the renter’s salary. In London, across every borough, rent for a one-bedroom flat is unaffordable. In Westminster, for example, the average 1-bed costs half the salary of the average resident.
Affordability ratio (median income vs median house price) by region, 2003-2023.

Depressingly, if unsurprisingly, this has led to London experiencing record levels of homelessness. There are more than 323,000 households on the waiting list for social housing and the number of households in temporary accommodation is at an all-time high. The human and financial cost of this is untenable. Roughly 1 out of every 21 children in London is living in temporary accommodation while local authorities already flirting with bankruptcy are spending an average of £4 million a day on temporary accommodation.
Contrary to public perception, there is plenty of space to build in London. But to win over the sceptics, new development must incorporate existing infrastructure to ensure that existing residents do not feel the strain.
Concreting over England, the Green Belt’s popularity, and overcrowding
By artificially constraining land supply, the MGB has contributed to the chronic housing crisis, leading to the real price of housing increasing four and a half fold and that of land increasing 15-fold. The alternative policies – densification and Brownfield development – have not, thus far at least, been sufficient to meet our housing need.
In reality, only 9 per cent of England has been developed.
But building on the Green Belt is unpopular because of people’s beliefs about green space in England. About 16 per cent of Londoners believe that more than 70 per cent of England has been built on, compared to just 10 per cent of all English people. But in reality, only 9 per cent of England has been developed.
This view contributes to the popularity of the Green Belt. A quarter of Londoners believe that “Green Belt” is a special category of land referring to “any green space, or national parks or areas of outstanding natural beauty,” which is helping to protect against the concreting of England. So much so that, when asked to prioritise housing or nature, 39 per cent of Londoners would prefer to retain the Green Belt in its current form “even if it restricts the country’s ability to meet housing needs”.
By limiting land supply, the Green Belt artificially inflates the cost of land and limits the number of homes that can be built.
Furthermore, the Green Belt is not itself wholly green, nor was it designed to be. It is a tool to prevent ‘unrestricted’ sprawl; prevent towns from merging; help safeguard the countryside; preserve the ‘character’ of historic towns; and support urban regeneration and densification. On many of these metrics, it has succeeded.
By limiting land supply, the Green Belt artificially inflates the cost of land and limits the number of homes that can be built. This makes it nigh on impossible for people to afford to live in areas they might like to, either to make a new start or stay near family, and it makes it harder to access better jobs. The Government’s proposed “Grey Belt” reform, intended to release “poor quality grey belt land from the Green Belt” gives us a way through. But how can we use it?
Build! Build! Build!
The first option is to build wherever there is space in the Green Belt. Removing open spaces like Metropolitan Open Land, Public Parks and Allotments (but not Golf Courses), leaves about 200 km2.
Bromley and Havering have the most land available for development, with 50km2 and 42km2 respectively. Each borough has a different character when it comes to housing type and density. Building in keeping with this character can make developments feel more in-tune with the local area.
Bromley’s Green Belt

Agricultural and grassland in Bromley’s Green Belt

Bromley’s Green Belt, trains available within 25 min walk

Looking forward, new transport investment could open up these sites for development, providing new infrastructure for old residents. This has been successful in developments like Battersea, Meridian Water and Barking Riverside. But building new tube and train stations takes time and is very costly.
If London wants to create a sustainable pipeline of housing, it is essential for developers and boroughs to go with the grain of public opinion rather than against it, respecting the character of communities and responding to local concerns.
The housing crisis is already damaging lives and threatening the success of London’s economy. The cost of not acting to address it is huge. Luckily, the size of the prize is also huge. In contrast to what is widely believed, there is plenty of space in London left to build. But if London wants to create a sustainable pipeline of housing, it is essential for developers and boroughs to go with the grain of public opinion rather than against it, respecting the character of communities and responding to local concerns.
All articles posted on this blog give the views of the author(s), and not the position of LSE British Politics and Policy, nor of the London School of Economics and Political Science.
Image credit: Livvy 2020 in Shutterstock
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