Mayor Highlights the Effect of the Housing Crisis on Business

Mayor Highlights the Effect of the Housing Crisis on Business

Last night the Mayor of London, Sadiq Khan, praised London First’s proactive role in alleviating the impact of the housing crisis on employees across the capital through the Fifty Thousand Homes employer housing pledges.

At an event at City Hall hosted by Cosmopolitan Magazine, the Mayor highlighted how the high cost of housing has led to a ‘brain drain’ oftalented professionals: last year, for the first time ever, more 31 – 39 year olds chose to leave London than moved to the capital. Taking questions from the audience, the Mayor and Deputy Mayor for Housing, James Murray, emphasised the importance of business taking action to keep talent in London, while lobbying the government for action on the housing crisis and the devolution of more powers to London government.

The Mayor also pointed to London’s need for a flexible immigration after Brexit due to its reliance on foreign workers, particularly the construction sector, where half of the 300,000 strong workforce are from the EU.

Earlier this year, the Mayor endorsed the launch of the Fifty Thousand Homes employer housing pledges, which now cover more than 100,000 people in London.

New data reveals scale of housing challenge for London’s Mayor

New data reveals scale of housing challenge for London’s Mayor

·       Fifty Thousand Homes campaign puts the ‘scores on the doors’ with detailed Ordnance Survey data

·       One in three new homes planned for London are lost after planning permission is granted

·       On average, it takes 13 months before building starts on most projects

Deposit Free Rentals – InsureStreet aims to work with Generation Rent

Deposit Free Rentals – InsureStreet aims to work with Generation Rent

Why is renting so expensive? If we all have different means, why should everyone be paying the same deposit? How can deposits be structured in a manner which eases the cash-flow burden for renters? What role can Insurance and Technology play in the solution to these issues?  These are some of the questions which the Founder of InsureStreet, Tahir Farooqui, hopes to answer by working with reputable landlords, agents and tenants. 

The Mayor of London has made it clear that housing remains “a number one, two and three priority”. Sadiq Khan has argued for firms to help ease the pain of renting by offering loans to employees to help cover deposits. He has stated that people being priced out of London, “… is bad for Londoners and bad for the future economic success of the capital”. Anything to help relieve the rental issue will be key to keep talent flowing to London, especially with the potential implications of a “hard Brexit”.

With the population of London expected to rise to 10 million over the next decade, the issues of attracting talent to London will become increasingly difficult. In 2016, the professional services firm Deloitte took a stance by pre-booking rented homes in the East Village for more than 40 of its graduates. 

InsureStreet has partnered with HISCOX to launch an innovative deposit insurance product in March 2017. Through InsureStreet, a cash deposit is replaced by a simple insurance policy. This reduces cash outlay for a new lease by up to 95%.

If tenants pay rent and bills on time, look after the landlord’s property and have had very few claims on deposit insurance policy, the platform rewards good behavior through a no claims discount. When it’s time to move again, Tenants’ can share their RentPassport™ and move into the house they like.

Read more about Insurestreet here:

twitter.com/InsureStreetUK

www.insurestreet.co

Businesses join forces with the Mayor to tackle London’s housing crisis

Businesses join forces with the Mayor to tackle London’s housing crisis

London employers are being asked to step up and sign pledges put forward by the ‘Fifty Thousand Homes’ campaign to help workers cope with soaring housing costs.

The pledges range from paying the London Living Wage for all staff and offering direct financial support, such as the Tenancy Deposit Scheme, to developing flexible working and providing guidance and advice to employees experiencing housing difficulty.   

Tenancy deposit loans help support employees with the cost of securing a rented property in London with businesses offering staff interest-free loans to cover the cost of a deposit, similar to what many firms currently do with season ticket loans. 

To lead the way, the Mayor has today signed up the whole GLA family to the Fifty Thousand Homes pledges – with City Hall, Transport for London, the Metropolitan Police, the London Fire Brigade, the London Legacy Development Corporation and the Old Oak and Park Royal Development Corporation all now having introduced or committed to offering tenancy deposit loans, as well as meeting the other Fifty Thousand Homes pledges.  

The Mayor praised the first businesses to sign up to the pledges - Optimity, Arup, Mace Group, UK Power Networks and Grant Thornton UK LLP – and called on businesses across London to follow suit.

The Mayor of London, Sadiq Khan, said: “It is unacceptable that so many hard-working Londoners continue to be priced out of their own city – it is bad for Londoners and bad for the future economic success of the capital. I am determined to tackle the housing crisis head on and I will be using my new planning rules and my record funding deal with government to build new affordable homes to rent and buy.

“We know that building new homes to tackle the housing crisis won’t happen overnight – it’s a marathon, not a sprint - but in the meanwhile we need to do whatever we can to help Londoners struggling to meet the soaring cost of housing. That’s why I am pleased to announce City Hall and the entire GLA family is now committed to offering tenancy deposit loans to staff, and I would urge all London businesses to sign the Employers’ Pledge on housing too. We must do all we can to retain and attract the best talent in our capital and to make sure we remain a city for all Londoners.”

Naomi Smith, Director of the Fifty Thousand Homes campaign, said: “London’s high cost of housing is a huge challenge for businesses, risking our ability to attract and retain the people we need to keep our city working and thriving. Employers want to help their workers struggling with rent or trying to get onto the housing ladder. But we have to start unlocking more land in London, otherwise we’ll carry on slipping backwards.”

To sign up to the Fifty Thousand Homes’ Employers’ Pledges, employers should visit fiftythousandhomes.london/pledge. Organisations will commit to implementing the first of their pledges within six months and the campaign aims to sign up 100 organisations this year.

 Robert Hannah, chief operating officer at Grant Thornton, one of the first companies to sign up, said: “Solving London’s housing crisis could unlock economic growth in the capital by helping businesses keep hold of the skilled people they need, as well as addressing some of the issues around social integration that are becoming more apparent. It is only through collaboration that we will be able to tackle the growing problem of housing in London and as a large employer of people in London, we want to take our share of that responsibility.”

The action comes as Fifty Thousand Homes research reveals the scale of the challenge the Mayor and employers are taking on. London’s overall housing shortfall has quadrupled since 2010, from 46,000 homes in 2010 to close to 210,000 in 2016, as a result of London’s growing economy and population and an historic failure to build more homes.

For the vital creative, tech, retail and hospitality industries, which contribute around £40bn to London’s economy each year, up to 150,000 homes are missing for people working in these sectors.

The Mayor has pledged to tackle the housing crisis head on and has set out new planning rules to help speed up the building of more affordable housing and has secured a record-breaking £3.15bn deal from government for 90,000 new affordable homes in the capital.

He has also begun identifying public land that can be used to deliver new housing, fast-tracking 75 sites across 300 acres of TfL land that could deliver up to 10,000 new homes for Londoners.

Many experts say that 50,000 new homes are needed in London each year and the average cost of a home in London is more than 14 times average earnings, which means there has to be a dramatic and sustainable increase in the number of homes being built to protect and enhance the capital’s competitiveness as a global city.

The Importance of Innovation in Addressing Housing Supply

The Importance of Innovation in Addressing Housing Supply

Author: Laura Stuart

The issue of housing in London remains at the forefront of discussions surrounding the capital, and as part of our housing inquiry we continue to look to bring together key individuals than can drive the conversations forward, and put the solutions in place.

Fifty Thousand Homes hosted a roundtable discussion with representatives from the public, private and third sector to understand what they perceive to the be the biggest obstacles to addressing housing supply in London, and how we can better work together to increasing the number of homes.

Ensuring definitions and targets are agreed and understood is critical, as this guides so many development and planning decisions about what actually gets built. Understanding what is meant by 'affordable' is also key, and it was agreed that the definition of 'affordable' needs to be stretched in both directions – understanding what types of homes are needed in London, by whom and where – and ensuring definitions and targets are calibrated to incentivise their supply and encourage innovative approaches.

There was a unanimous agreement that the gap in suitable places to live for households who don't quality for social rent, but who earn below £70,000 a year – the level at which is becomes feasible to buy in London at current prices – was far too big. With average wages in London being closer to £30,000 this provides employers with a huge concern in ensuring they and the capital can recruit and retain the best talent. Equally in the property sector specifically there was a cry for a concerted national effort to invest in the skills that construction industry needs – which considering Brexit is more important than ever.

The theme of trust continued to be raised when discussing how we can increase supply, with both public and private distrusting the other. Local authorities are suspicious of the motives of private sector, while private sector business don't always believe in the competency of local government to deliver on joint ventures. As collaborative working is critical to addressing housing, this perception needs to change – more trust must be built and barriers between sectors broken down.

Our roundtable discussion provided a forum in which to raise why each held this perception and what could be done to begin building the trust. Flexibility at local authority level, particularly around planning, was welcomed, with increased devolution – coupled with deregulation – allowing facilitation of tailored approaches proposed as one way forward. Local authorities setting up their own development companies was also discussed, which removes the issue of land availability as land is generally under local authority ownership, but also brought with it a concern that local authorities lack the expertise around property development. Housing Associations, with their long track record of successful property management, were seen as having a pivotal role to play.

What is clear, is that innovation is vital to addressing housing supply. At its current rate not enough houses are being built, and this will remain the case until we start looking at different methods – innovation is needed in approach, planning, supply models, financing and construction to reach the targets that have been set. Although there is no one-size-fits-all model for this, there are success stories that we can learn from and adapt, and our inquiry will continue to facilitate those who can adapt and implement these learning.

Laura is Associate Director Public Policy at Grant Thornton where she focuses on their Vibrant Economy work

New Deputy Mayor for Housing, James Murray, on how employers can help employees with housing

New Deputy Mayor for Housing, James Murray, on how employers can help employees with housing

 

Listen to new Deputy Mayor for Housing, James Murray, speaking at the launch of our report with Grant Thornton, on how employers can help employees with housing.

The report looked at the views of business on the housing crisis and actions being taken to support staff with their housing needs.

You can download the report here

The findings reveal that eight in ten businesses (84%) believe that high housing costs pose a risk to the capital’s economic growth. Nearly half (48%) of the employers surveyed have taken steps to help their workforce deal with London’s high housing costs.

Grant Thornton's press release can be found here

 

How can London employers help tackle the housing crisis?

How can London employers help tackle the housing crisis?

While the Fifty Thousand Homes campaign has amplified the voices of business leaders in the Capital to speak loudly and powerfully on the business case for solving the housing crisis, we now turn inward to assess our own role as employers.