London in Need of Up to 50,000 New Homes; Does Boris Have the Answer

The UK housing market is of particular interest to Maxim Recruitment in terms of UK Construction jobs. It has been spiralling fast particularly in London and has only just shown signs of slowing slightly.

Meanwhile the Bank of England which is still holding interest rates at an all time low of 0.5% has taken measures to limit the number of large loans available so that debt does not rise too steeply.

Everyone seems to be in agreement that London needs more housing. It’s been a recognised fact for several years and meanwhile the cost of housing has escalated. It is estimated that the average home in London costs almost half a million pounds and this is expected to rise by 13% to £565,000 by 2020.

This is good news for UK construction and Maxim’s portfolio.

London construction
The housing shortage in the capital is far more complicated than the astronomical prices which are running at about 10 times the average UK salary.

The shortage is affected by funding and infrastructure to put it simply. One London construction project for 10,000 homes is the Barking Riverside scheme. With 1500 homes completed this project is about to come to a halt because of a lack of infrastructure. Originally it was planned that the Dockland Light Railway would be extended to make the link. This was to cost £500 million but the funding was ‘pulled’ and even though a more reasonable alternative plan costing £200 million has been put forward, it still awaits the Chancellor’s approval.

London construction shortfall
The general consensus is that London needs between 40 and 52,000 new homes. Different parties predict different figures but regardless it is a significant number.

With only 17,000 new homes built in the capital in the year preceding the end of March 2014, the shortfall is obvious for all to see.

In the long term lack of affordable housing in the capital will make recruitment and employee retention more difficult. So the problem needs to be tackled sooner rather than later.

Boris offers some hope
Meanwhile the controversial Mayor of London, Boris Johnson has named 20 sites which will accommodate 50,000 new homes going a good way to meet the shortfall.

These sites, according to Johnson, are made up of local authority land with planning permission for development of housing. This is backed by the government with loans available to local authorities for the infrastructure that will be necessary to service these zones. It should also cover any other remedial work necessary to the sites.

Johnson has also been given stronger planning powers. With Mayoral Development Orders he will be able to remove any obstructions to planning and development of the sites. 

Boris Johnson is quoted as saying, “Housing is the biggest challenge facing London’s economic development and these new £400 million housing zones will turbo-boost housing supply across the capital.

“This major regeneration will transform communities and provide up to 50,000 much needed homes.”

Maybe Boris does have the answer. Time will tell.

Roles in UK construction
Certainly if Boris’s plans are put into action, it should be good news for UK construction in the housing market. We will be watching this market closely but the need has been identified and should keep this sector moving.

So if you are looking for positions in UK construction please let us know. We are happy to advise and keep you informed of upcoming positions in this market place. Why not give us a call on 0870 243 0446 or email us at information@maximrecruitment.com to discuss your requirements with one of our consultants.

Adam Cadwaladr
Maxim Recruitment
UK Office