29-07-2025
London's Housebuilding Collapse Is a Huge Problem
Homebuilding in London has all but ground to a halt. The capital is on track to deliver less than 5% of its annual target of 88,000 homes with half the year gone, by far the worst performance in two decades. Such a collapse in the UK's largest and richest city would be a poor omen for economic growth and productivity at the best of times. For this to be occurring under a one-year-old Labour government that arrived in office promising a generational uplift in housing supply is extraordinary.
The figures almost defy belief. Housing starts have fallen by more than 90% compared with the financial year ended in 2023, official data from the Greater London Authority show. Across two-thirds of the capital's boroughs, there were zero starts in the second quarter on developments with more than 20 private homes, according to researcher Molior London. Sales, meanwhile, are running at their weakest rate since 2009 with just 3,950 new homes purchased in the first half of 2025, the company said.
