A recent report has recommended that the Mayor of London reduce the requirements for affordable housing and release large areas of green belt land to address the housing crisis in the capital.

The Home Builders Federation (HBF), a trade association representing private developers, highlighted that the London Plan and a newly established building regulator are causing significant delays in housing development.

The report pointed out that London is tasked with delivering 440,000 of the government’s goal of 1.5 million new homes by 2030, yet only 30,000 new homes were built in the past year.

However, a housing advocacy group contended that such changes would primarily benefit developers looking to enhance their profits.

Sir Sadiq Khan has faced criticism after recent data indicated that London might fall short of its affordable housing targets, as well as overall housing construction.

In the financial year 2023/24, new housing starts in London declined by 9%, whereas the rest of England saw a 5% decrease.

The HBF pointed to a “perfect storm” of challenges facing London, including low demand from struggling first-time buyers, planning delays, and issues related to the Building Safety Regulator (BSR), which was created in 2022.

The BSR has also been criticized heavily by the mayor’s office.

City Hall asserted that the mayor is doing “everything in his power to increase the supply of homes across all categories.”

According to the HBF, the complexity of the mayor’s London Plan deters potential developers.

This plan serves as a vital planning document, outlining a framework for the long-term development of London.

The Mind the Gap report’s authors observed that the regulatory environment for developers in London is more complicated and cumbersome than in any other part of the UK.

The HBF suggested that the forthcoming London Plan, expected to be released in 2027, should ease the regulatory burden on developers by simplifying any additional policies that pertain to residential projects.

John Myers, director of the YIMBY (Yes in My Back Yard) Alliance, told the Local Democracy Reporting Service that with only 731 market homes initiated in London during Q2 2025, there is an urgent need to rejuvenate homebuilding efforts.

He proposed that revisiting the rules of the London Plan could be a viable solution.

Concerns were raised about the costly dual-aspect requirement and the arbitrary limit of eight homes per staircase or lift core, which hinder the viability of many brownfield sites.

Furthermore, the HBF report indicated that the current mandate for new developments to include 35% of units as affordable housing is too stringent, recommending that this figure be lowered to 25%.

The report urged ministers to reconsider the forthcoming Building Safety Levy, set to be implemented in 2026, which requires developers to fund the remediation of defects, and to introduce a targeted home ownership program for first-time buyers.

Neil Jefferson, chief executive of the HBF, stated that the insights from the Mind the Gap report should serve as “a significant wake-up call” for both government officials and the Mayor of London.

He emphasized the need for a critical reevaluation of housing policies to address the needs of London residents effectively.

Conversely, Suzanne Muna from the Social Housing Action Campaign (SHAC) argued that the push to decrease the number of affordable homes in new developments is driven more by greed than by legitimate concerns about planning complexities.

She defended the necessity of regulations, particularly in light of tragedies like the Grenfell fire, asserting that such standards should be upheld.

A spokesperson for City Hall responded to the Local Democracy Reporting Service, stating, “The disastrous legacy from the previous government has left national housebuilding in a state of crisis.”

They expressed that Sir Sadiq is “making tough choices,” which include considering the development of green belt land.