Housebuilding in London has sunk to its lowest level since the global financial crisis brought construction to a grinding halt 16 years ago.
Work was started on just 1,210 new private flats and houses in the first quarter of the year, according to latest figures from analysts Molior.
That represents just 5% of the 22,000 quarterly target set by the Government and is one of the worst performances on record in a city desperately trying to find solutions to a crippling housing crisis.
Alarmingly there were no starts at all in 23 out of London’s 33 local authority areas during the three months from January to March.
Labour has set a target of building 1.5 million new homes nationally by the end of the decade, including 88,000 a year in the capital.
Developers say they are facing a perfect storm of obstacles including post-Grenfell fire safety regulations, planning delay, massively increased building costs, stagnant sale prices, a shortage of wealthy off plan investors, and stubbornly high interest rates.
The outlook is not much more encouraging looking ahead with just 7,100 new private homes scheduled to be completed in 2027 and 2028 with no completions at all in 16 boroughs. They include Bromley, Lewisham, Hackney, Hounslow, Havering, Kingston Upon Thames and Merton.
Molior said that number will rise as further schemes get underway “but the industry will need to get a move on to make a meaningful impact on 2027-28 delivery.”
It also said that while the Government is working hard to speed up the planning process, it can do little to stimulate demand.
It said:”The Government is working hard to address supply side regulatory hurdles with unprecedented determination. However a less mentioned elephant in the room on the demand side, construction starts, have been in steady decline since 2017, not just due to policy constraints, but because sales volumes have also been falling.
“Off-plan investment buyers cause schemes to commence construction, and they are sorely missed.”
Sales were also depressed in the first quarter with a total of 2,370 recorded across London, the lowest since 2011, and only 28% of the 2015 peak when there were 8590.
The Molior report concluded that the Government’s efforts to free up the supply side “will not boost growth without much greater pull from the various sale segments that ultimately fund house building. The Government does hold some tax levers in this respect, the question is whether it has the political appetite to pull them.”
