266% pay rise – what the average Londoner needs to buy a home

// HA News

Figures from the National Housing Federation’s Home Truths report reveal that the average London home now costs £526,000 - 16 times the average Londoner’s salary of £33,000 a year. However, if the mayor does commit to offering the sector priority access to public land, could housing associations help save the day?

The report marked the launch of the 100,000 Affordable Homes for London campaign – an offer from London’s housing associations to help the next mayor tackle the current 151,000-home deficit.

Low supply and high prices are not the only barriers to homeownership highlighted by the research. Rent in the capital now averages £1,461; around a third of the people’s pay packets. 

The National Housing Federation’s Home Truths report also showed that:

• More than half of all London boroughs require an income of more than £100,000 to buy the average house.
• There are 48,000 second homes in London – with Kensington & Chelsea, Westminster, Camden, and Tower Hamlets topping the list with more than 5,000 each.
• The least affordable borough was Kensington & Chelsea, where despite average earnings of £59,000, homes were still 33 times incomes at £1.94 million on average
• The most affordable boroughs were Bexley, Barking & Dagenham, Havering, Croydon and Redbridge – but homes still cost 11 times average incomes

Housing associations built 40,000 homes for rent and sale in London over the last mayoralty, but are ready to ramp up delivery. If the mayor commits to offering the sector priority access to public land, housing associations can make a big contribution to building the 100,000 affordable homes needed over the term ahead.  As London housing associations already raise £7 for every £1 of public money, this will also provide good value for money for Londoners.

Speaking when the campaign was launched, Chief Executive of the National Housing Federation David Orr said “A secure and affordable home should be available to everyone.  Living in London doesn’t have to mean living in cramped, overpriced, insecure accommodation; the housing crisis is not inevitable.  Housing associations know how to tackle the crisis and provide quality homes which suit all Londoners.”

“Both Sadiq Khan and Zac Goldsmith have correctly identified housing as one of the biggest challenges facing London.  We’re here to say that we know how to help.  If the next mayor works with us to tackle the housing crisis at a London level, as we are working with the Government to tackle it at a national level, we can go a long way towards solving the housing crisis.”

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