With less than four months until implementation, are you ready for the biggest change to social housing compliance in decades? On 23rd October 2025, something unusual happened in British housing policy: the government and the Mayor of London actually agreed on something.

Standing together, they unveiled what they're calling "emergency measures" to kickstart housebuilding in the capital. The press releases were full of the usual optimism—tens of thousands of homes unlocked, affordability restored, spades in the ground.

But strip away the political choreography, and what you're left with is more revealing than any ministerial statement: an admission that London's housing system has fundamentally broken down.

This isn't a tweaking of planning guidance. It's not another consultation on density standards. It's the government and City Hall essentially saying: the normal rules have failed, so we're suspending them.

The question is whether these measures are radical enough to fix what's actually broken or whether they're just rearranging the deck chairs on a sinking ship.

The Perfect Storm (That Everyone Saw Coming)

Let's start with why we're here. Housing starts in London have crashed to their lowest levels for at least 20 years, with more than a third of boroughs recording zero housing starts at all in Q1 of 2025.

Think about that for a moment. In one of the world's most expensive housing markets, with chronic shortages and record waiting lists, more than a third of London boroughs started building precisely zero new homes in the first three months of 2025.

The reasons aren't mysterious. Mayor Sadiq Khan called it perfectly: "a perfect storm facing housebuilding in London due to a combination of high interest rates, the rising cost of construction materials, the impact of the pandemic and ongoing consequences of Brexit".

But it's worse than that. Add in:

• Spiralling construction costs that outpaced grant funding

• Post-pandemic labour shortages and supply chain chaos

• Building Safety Regulator bottlenecks choking high-rise schemes

• Structurally weak planning departments unable to process applications

• Design guidance that's quietly killed marginal schemes through prescriptive requirements

Recent figures indicate that just 15-20,000 new private homes (on schemes of 20+ homes) will be actively under construction in London by January 2027, compared with 60-65,000 homes under construction at any given time between 2015 and 2020.

That's not a dip. That's a collapse.

Affordable housing starts have plummeted by 84% since their 2022 peak—falling from 25,658 to just 3,991.

The capital hit a point where even well-capitalised schemes with grant funding no longer stacked financially. Viability—that word that appears in every planning negotiation—has quietly collapsed across huge swathes of London.

What's Actually Changing

So what are they doing about it? The package announced on 23rd October contains several significant moves:

A Fast-Track Planning Route

Time-limited emergency measures will unlock development through a fast-tracked planning process for sites with at least 20% affordable housing, down from the previous 35% requirement under the Mayor's Fast Track route.

But here's the kicker: The package reduces the affordable housing requirement from 35% privately funded to 10% privately funded plus 10% grant funded. This is a tacit admission that the previous targets were killing schemes.

The new route is open until 31st March 2028 or whenever the new London Plan is published, whichever comes first. It's explicitly time-limited, creating urgency to get schemes moving.

Relaxed Design Restrictions

The Greater London Authority proposes to withdraw dual aspect guidance and dwellings per core guidance, and reduce cycle parking requirements for residential developments to reflect higher densities and introduce greater flexibility.

This matters more than it sounds. These weren't just guidelines, they were viability killers. Every extra requirement reduces the amount of saleable space and increases costs. When margins are tight, these add up to the difference between viable and unviable.

Temporary CIL Relief

The government proposes temporary CIL relief for residential floorspace on eligible brownfield schemes that commence after the relief takes effect and before 31st December 2028, with qualifying schemes receiving a 50% reduction in borough-level CIL where they provide at least 20% affordable housing.

Community Infrastructure Levy has been quietly killing marginal schemes for years. This relief is essentially grant funding by another name—a way of making schemes viable without calling it a subsidy.

Mayoral Power Grab

This is where it gets politically interesting. The Mayor will receive new powers to review and call-in housing schemes of 50 homes or more where boroughs are minded to refuse, and can become the decision-maker regarding developments of 1,000sqm or more on green belt.

The streamlined approach will allow the Mayor to expedite the call-in process in certain cases without the need for a full hearing process, cutting up to six months from the planning process.

And crucially: The Mayor will be given greater freedom to deliver Mayoral Development Orders, which will help unlock more homes by removing the veto from local authorities.

Read that again. Local authorities are losing their veto. The Mayor becomes the effective planning authority for any significant scheme in London.

This is a fundamental shift in how planning power works in the capital.

The £322 Million Fund

The government is confirming an initial £322 million to establish a City Hall Developer Investment Fund to ensure the Mayor can further increase housebuilding.

This isn't traditional grant funding. It's an investment fund, allowing City Hall to directly intervene in stalled sites, co-invest in strategic developments, and derisk affordable housing elements.

The political message is clear: if developers can't get schemes off the ground, City Hall will do it for them.

Will It Actually Work?

Here's where honest assessment matters. These measures will help. They're addressing real barriers, viability pressures, planning delays, design constraints, funding gaps.

But let's be clear about what they won't fix:

They won't solve the Building Safety Regulator bottleneck. It's estimated that roughly half to three-quarters of the 35,000 dwellings stuck in the BSR as of July are in London, and the BSR is responsible for about half of London's collapse in housing starts. The government has announced measures to speed up BSR decisions, but delivery remains uncertain.

They won't address chronic under-resourcing in planning departments. Faster Mayoral call-ins don't help if borough planning teams can't process applications in the first place.

They won't fix labour shortages or supply chain fragility. Construction capacity is a real constraint, you can't build homes without workers and materials.

They won't solve the fundamental affordability gap. Making schemes marginally more viable doesn't address the underlying mismatch between construction costs and what people can afford to pay.

As the Centre for Cities analysis notes: "While the emergency measures are important, the Government and Mayor of London will need to go further. Much of the solution to London's housebuilding issues depends on sorting out the BSR".

What This Really Signals

Strip away the policy details, and what's revealing is the philosophy shift these measures represent:

Viability now trumps design ideology. The relaxation of dual aspect, dwellings per core, and cycle storage requirements signals that making schemes financially viable matters more than achieving design perfection.

Speed matters more than local democracy. Removing local authority vetoes and fast-tracking Mayoral decisions is a direct trade-off: faster delivery, less local control.

Centralisation is replacing localism. The Mayor becomes the de facto planning authority for strategic development across London—a generational shift in how planning power works in the capital.

Affordable housing becomes the currency of planning privilege. Want fast-track planning and CIL relief? Commit to 20% affordable housing. It's a simple bargain: speed and viability in exchange for genuine affordability.

Green belt taboos are cracking. City Hall decision-making on green belt schemes above 1,000sqm marks a profound shift. The untouchable is becoming touchable.

The Uncomfortable Truth

Housing Secretary Steve Reed framed it optimistically: "I have worked closely with the Mayor of London to give the capital the shot-in-the-arm it needs to ensure more Londoners have an affordable home of their own".

But let's be honest about what this package really represents: an admission that you cannot regulate, design-guide, or levy your way out of a housing shortage.

For years, planning policy has layered requirement upon requirement each individually defensible, collectively impossible. Higher affordable housing percentages. Stricter design standards. Increased infrastructure contributions. More onerous building safety compliance.

Every requirement made schemes less viable. And when enough schemes become unviable, the entire system stalls.

These emergency measures are essentially saying: we went too far, and now we need to dial it back to get anything built at all.

That's not a comfortable admission for policymakers who spent years creating the very requirements they're now suspending.

What Happens Next

The package is subject to a six-week consultation starting in November. CIL relief and expanded call-in powers will require secondary legislation. The procedural changes need primary legislation.

Industry reaction has been cautiously positive. G15 chairman Ian McDermott said the emergency interventions were "crucial to unlocking stalled sites." But he added a crucial caveat: "Time will tell if there is sufficient market demand for developers to scale up delivery on the back of today's announcements".

That's the £322 million question. These measures improve viability and speed up planning. But they can't create demand that doesn't exist, or construction capacity that isn't there.

What they can do is restart a system that has ground to a halt. Whether that's enough to meet London's 88,000 homes-per-year target remains deeply uncertain.

The Bigger Picture

This isn't just about London. It's a test case for what happens when housing policy collides with economic reality.

Other cities face similar pressures, maybe not as acute, but moving in the same direction. If London needs emergency measures to restart housebuilding, what does that say about the sustainability of the planning system elsewhere?

And if the solution requires suspending design guidance, reducing affordable housing requirements, overriding local democracy, and direct government investment what does that tell us about the system we've built?

Perhaps this: that we've created a regulatory framework so complex, so demanding, and so expensive that normal market mechanisms can no longer deliver at the scale required.

That's not a comfortable conclusion. But it might be an honest one..

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