London stands as the richest city in Europe; however, for numerous residents, achieving stable housing feels increasingly unattainable, as noted by the Centre for London (CfL).
This week, the independent organization convened the London Housing Summit, shedding light on the ongoing housing crisis, which they describe as “spiraling out of control”.
Experts widely acknowledge that this issue is multifaceted, but what do the statistics indicate regarding its magnitude?
Data from the Combined Homelessness and Information Network (CHAIN) shows an 8% rise in rough sleeping in the capital compared to the same time frame in 2024.
Nearly half (47%) of those experiencing rough sleeping are newly homeless individuals, while intermittent rough sleepers account for 39%. The remaining 16% were found living on the streets, according to the latest annual report from CHAIN for 2024/25, which states that rough sleeping in London has reached an “all-time high”.
The Mayor of London, Sir Sadiq Khan, has pledged to eradicate rough sleeping in the city by 2030. In January 2025, he announced an additional £10 million investment aimed at achieving this objective.
This funding is designated for the expansion of Ending Homelessness Hubs, which provide round-the-clock specialized support for individuals newly facing rough sleeping and offer preventive services.
Local authorities have a legal obligation to accommodate residents who become homeless, typically placing them in temporary accommodations such as hotels or hostels until more stable housing can be secured.
As the number of homeless individuals has surged recently, so too has the financial strain on local governments.
The umbrella organization for London’s boroughs has reported that the current expenditure on temporary housing is “unsustainable”, risking many councils with “effective bankruptcy” and creating significant uncertainty for future local services.
London Councils have indicated that boroughs exceeded their homelessness budget for 2024/25 by £330 million, with expenditures in this area increasing by 68% within a single year.
Recent analyses reveal that over 183,000 residents of London are currently homeless and residing in temporary accommodations like hostels arranged by their local authorities, including 90,000 children — which translates to more than one child for every classroom, according to London Councils.
The Housing and Mental Health Network is striving to emphasize the human impact of these statistics to policymakers. At the London Housing Summit, Dr. Sally Zlotowitz, co-chair of the network, expressed concern that individuals in temporary accommodations are “internalizing an issue that is a structural crisis”.
Grace Williams, executive member for housing at London Councils, has characterized this situation as an “emergency” that is “devastating the lives of too many Londoners”.
The organization has urged the government to support local councils by increasing funding for immediate temporary housing solutions and long-term strategies such as enhancing grant funding for affordable housing.
In response, a government spokesperson stated: “We inherited a serious housing crisis, which is why we are taking urgent and decisive action to end homelessness, stabilize local government, and advance our Plan for Change.
“We are allocating £1 billion for essential homelessness services so councils can assist families more swiftly. This represents a £233 million increase from 2024-25, and London Boroughs have received an additional funding boost of over £78 million.
“We are also addressing the underlying causes by constructing 1.5 million new homes, increasing social and affordable housing, and eliminating section 21 no-fault evictions.”
The private rental market in London is contracting as landlords increasingly opt to sell their properties.
Analysis from Trust for London indicates that 45,000 homes were lost from the private rental sector between April 2021 and December 2023, representing a net decrease of 4.3%.
The charity highlighted that this shrinkage is occurring at a much faster rate in affordable rental areas, which it believes particularly impacts low-income households seeking access to private rentals.
The National Residential Landlords Association commented that “uncertainty regarding potential tax and regulatory changes is causing many landlords to contemplate exiting the market”. The association noted that demand for private rental homes continues to rise, resulting in increased costs for renters and a decrease in availability.
According to the Office for National Statistics (ONS), the 2.7 million private tenants in London experienced an 11.5% increase in rents in 2024, marking the steepest rises in England.
Recent polling by the Centre for London reported that three out of five renters in the capital feel rent is unaffordable for them personally.
The demand for homes, as well as the expense of constructing them, is more pronounced in London than in any other part of the country, according to analysis from the Centre for London.
Upfront housing costs in London are 43 times higher than in the West Midlands and 36 times greater than in Greater Manchester.
Research from the think tank suggests that fulfilling the housing needs in Wandsworth, which has the highest upfront costs in England, would cost four times the amount needed to meet the entire housing target for the West Midlands.
Further, polling by the think tank indicated that 45% of Londoners surveyed identified the inability of first-time buyers to afford homes as the most significant issue within London’s housing market.
A spokesperson for the Mayor of London stated: “The mayor will persist in collaborating with the government to create more genuinely affordable housing through planning reforms and new investments, aiming to address London’s housing crisis and build a fairer environment for all.”
Deputy Prime Minister and Housing Secretary Angela Rayner emphasized that there is “no time to lose” and that it is “essential” to “get Britain building”.
While there are targets for new housing, delegates at the recent London Housing Summit voiced concerns about the condition of existing homes in London.
Polling from the Centre for London showed that one-third of Londoners have faced issues with damp and mould, and over a quarter reported difficulties in keeping their homes adequately warm.
Housing activist Kwajo Tweneboa, who uses social media to raise awareness on damp and mould issues, remarked during an interview on BBC Radio London that the situation is “horrific”, adding, “there are moments when I wonder if it’s possible for things to get any worse”.
During the 2024 mayoral election campaign, Sir Sadiq Khan pledged to implement high-tech mould sensors, which City Hall indicated would serve as an “early warning system”.
Industry leaders have raised alarms about a ‘critical shortage’ of construction professionals. The latest figures from the Office for National Statistics reveal over 35,000 job vacancies within the sector, with employers indicating that more than half of these positions are unfillable due to a lack of necessary skills – the highest rate across all sectors.
An additional requirement for 160,000 construction workers is specifically aimed at meeting Labour’s housing construction targets. Prior to the government’s commitment to build 1.5 million new homes, the CITB had already predicted a need for a quarter of a million additional construction workers to satisfy the nation’s housing needs.
Before the spring statement in 2025, Chancellor Rachel Reeves announced a £600 million investment to train an additional 60,000 skilled construction workers, and Education Secretary Bridget Phillipson has committed to expanding ‘skills bootcamps’ within the construction field, with £100 million allocated for training and developing workers.
So, what is the strategy for London?
A spokesperson for the Mayor of London indicated that Sir Sadiq Khan has prioritized addressing the city’s housing crisis throughout his tenure.
In 2018, City Hall launched the Mayor’s Construction Academy (MCA), designed to aid Londoners in acquiring the skills necessary to enter the construction workforce.
The mayor’s office expressed hope that the MCA will contribute to fulfilling the demand for skilled construction labor in London.
