London's Housing Crisis: How City Hall Stacks Up Against Paris, Toronto and Tokyo

London built roughly 35,000 new homes in the 2024-25 financial year — less than half the 90,000 annual target the Mayor's office has cited as necessary to meaningfully dent the affordability crisis. That shortfall, confirmed in Greater London Authority figures published last month, is sharpening a debate about whether the city's governing structure is simply too fragmented to compete with major international rivals that have consolidated planning powers and dedicated municipal budgets.

The timing matters. Keir Starmer's government is pushing the Planning and Infrastructure Bill through Parliament, promising to strip back local veto power and hand regional bodies greater authority over development zones. For London, that should theoretically be good news — but the city's own internal politics are complicating any clean win. Khan's draft London Plan, currently under review at Southwark's offices on Tooley Street, has drawn 14,000 objections from borough councils, amenity groups and resident associations since its February consultation opened.

What Paris and Toronto Are Doing Differently

The comparison with Paris is pointed. The Métropole du Grand Paris, established in 2016, pools planning, transport and economic development across 131 communes under a single accountable body with its own tax-raising powers. Grand Paris Express — the €36 billion metro expansion currently boring beneath the Seine — is financed partly through a dedicated property value capture levy that London has no equivalent of. Île-de-France delivered 68,000 new housing units in 2024, nearly double London's output, despite having a comparable population of around 12 million.

Toronto offers a more cautionary tale, but also a lesson. Ontario's provincial government used strong-arm legislation in 2023 to override local zoning bylaws, forcing mid-rise density around subway stations. The politics were brutal and the legal challenges ran into 2025, but the city permitted 43,000 units last year — a 22 percent increase on its pre-intervention average. London boroughs watch that model nervously. Islington Council, which has consistently blocked tall buildings along Upper Street and around the Angel, has already signalled it will mount a judicial review if Whitehall attempts anything similar under the new Planning Bill.

Tokyo remains the data point that planners in City Hall on Queen Victoria Street return to most often. Japan's national zoning code, which allows central government to override municipal rules on building height across the entire country, kept Tokyo rents broadly stable for a decade even as London's average private rent crossed £2,200 per month last year. The structural difference is stark: Tokyo's metropolitan government controls roughly 40 percent of its own budget; London retains control of barely 7 percent of the taxes raised within its borders, according to the Centre for Cities' 2025 devolution index.

Khan's Next Move — and the Boroughs' Counter

City Hall is betting on three specific levers to close the gap. The Mayor's Affordable Homes Programme, currently funded at £4.2 billion through to 2028, is being renegotiated with the Treasury ahead of the autumn spending review, with Khan's team pushing for an uplift of at least £1.5 billion. A second lever is the Silvertown Tunnel development corridor in east Greenwich, where a planning framework published in May designates roughly 12,000 homes across four sites including Thamesmead and the Charlton Riverside zone. Third is a proposed municipal development corporation specifically for the Old Oak and Park Royal area in west London — 25,500 homes planned, a mayoral development order already in place, but construction stalled over infrastructure funding gaps.

Borough leaders are not simply obstructing for sport. Westminster City Council and Hammersmith & Fulham both point to inadequate school place projections, GP surgery capacity and sewerage capacity as legitimate constraints that faster planning sign-off would simply paper over. Thames Water, currently in administration, has warned it cannot guarantee new connection agreements for large sites until its debt restructuring is resolved — a problem Paris's Eau de Paris, a publicly owned utility, does not face.

Parliament returns from recess on September 1st. The Planning and Infrastructure Bill is expected to reach report stage in the Lords by October, and the outcome of the Treasury negotiation on affordable homes funding will be known by early November at the latest. London's boroughs have until September 19th to submit final responses to the draft London Plan. Whatever emerges from those three deadlines will determine whether City Hall can begin to close the gap on its continental rivals — or whether the 35,000-home figure becomes the new normal.