London Mayor Revises Housing Targets Below Manchester and Birmingham Pace

The Mayor of London has revised the affordable housing section of the London Plan, setting a requirement that major residential schemes deliver at least 35 percent affordable homes on site or through cash contributions to the borough. The change applies to planning applications submitted after 1 August 2026 and directly affects developers working on sites in all 32 London boroughs plus the City of London.

National planning reforms scheduled to take effect in 2026 have prompted the update, as the government requires local plans to align with revised housing need calculations. London’s existing targets were set in the 2021 London Plan, and the revision responds to updated household projections released by the Office for National Statistics in 2025.

Effects on daily costs and services for London households

Households on council waiting lists in boroughs such as Newham and Brent will be assessed against the new on-site delivery rules when schemes reach planning committees. Families currently paying market rents in converted office blocks in Southwark may see a proportion of future conversions reserved for social rent levels set by the Greater London Authority formula. Transport for London staff living in shared ownership units funded through previous Section 106 agreements will not be affected by the revised percentage.

The Greater London Authority’s 2025-26 budget allocates £1.1 billion to affordable housing programmes, a figure published in the March 2025 budget papers. This sum supports grant payments to registered providers operating inside the M25 and is separate from the £3.2 billion national Affordable Homes Programme administered by Homes England.

Next steps for boroughs and developers

Each London borough must update its local plan guidance by December 2026 to reflect the new threshold, according to the timetable set out in the Mayor’s written statement to the London Assembly on 9 July 2026. Developers with live applications will be invited to renegotiate viability assessments before the end of the financial year. The GLA expects the first schemes assessed under the revised rules to reach completion in 2029.