Today, London Mayor Sadiq Khan has announced a hyper-local approach to delivering affordable housing, which could provide a blueprint for what is to come under the incoming prime minister, Andy Burnham.
Burnham has made it clear that devolution – decentralising power away from Westminster – is central to his plan for Britain.
The former mayor of Greater Manchester has also said building new council housing is a key pillar of his policy agenda.
Today, in his much-anticipated London Plan – a statutory development document that outlines how the city will grow and develop over the next two decades – Khan has announced new local affordable housing thresholds for developers to hit in individual boroughs within the capital, as opposed to imposing one target on the entire city.
This, as London’s Deputy Mayor for Housing, Tom Copley, told The i Paper, is a “more localised and granular” approach which aims to “maximise affordable housing delivery” across London.
Copley explained that in boroughs where development is particularly viable – where flats are currently in demand and selling for a good price – developers will be expected to deliver 35 per cent affordable housing in any given development. In areas where developers are more financially constrained because house prices are lower, it will be 25 per cent or 20 per cent.
Under the proposals, the affordable housing threshold would be 35 per cent in Wandsworth, Lambeth, Southwark, Hammersmith and Fulham, Kensington and Chelsea, Westminster, Camden, Islington, Hackney, Tower Hamlets, the City of London and Richmond upon Thames.
It would be 25 per cent in Merton, Lewisham, Greenwich, Newham, Waltham Forest, Haringey, Brent and Ealing. And then 20 per cent in the remaining boroughs.
Longer term, the hope is to move back to 35 per cent social and affordable housing in as many boroughs as possible.
From 2028, these threshold changes will replace a controversial package of “emergency” measures imposed on London by Sir Keir Starmer’s Housing Secretary, Steve Reed, in October 2025.
As The i Paper revealed after a leaked memo outlining the changes was shared with us, Reed slashed the amount of affordable and social housing that private developers were required to build from 35 per cent to 20 per cent, effectively giving them a tax break, in a bid to boost housebuilding in the capital.
Despite this attempt to put rocket boosters under London’s developers, the capital is still facing a severe housebuilding crisis for a combination of reasons: higher labour and construction costs for builders, a lack of demand for new-build flats due to concerns about quality and leasehold and affordability for buyers.
Construction starts in the capital have collapsed by 84 per cent over the last decade, with only about 6,325 private sector homes breaking ground in the first quarter of 2026 – just 7 per cent of the city’s 88,000 annual target.
However, council house building has also been a key priority for Khan. Since 2018, City Hall says that nearly 30,000 new council homes have been delivered or are under way in London. Last year, 49 per cent of all new council homes in England were built in London.
Copley and Khan said that building more council homes will be a key part of the new London Plan.
The London Mayor and his deputy hope that their new flexible approach will “provide certainty for developers who will know the different requirements in each borough”, and “speed up” the building of affordable housing by reducing “protracted viability discussions where affordable housing thresholds are met”.
‘What devolution can deliver’
This new approach to affordable housing is devolved by borough and could be read as an example of what it is possible for mayors to achieve when they have the power to implement new rules in their area.
Copley said the London Plan, which also includes more rigorous fire safety standards for housing developers than other parts of the country due to the number of high-rise buildings in the capital, is “an example of what devolution can deliver for people”.
“We are already using the devolved levers that we have to make sure that we are putting in place policies that reflect London’s almost unique position as a very urban location,” Copley added. “Further devolution, of course, would give us the ability to do more of that.”
Plans believed to be under consideration by Burnham reportedly include how to give mayors more economic power, which could extend to the ability to raise more taxes locally, in order to deliver housing and infrastructure.
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