Press Release

20 Per Cent of Housing Target Could be Met Through Densification of Large Estates

A new report released today by Centre for London estimates that the densification of London’s large housing estates could boost the capital’s housing stock by 4,000 – 8,000 new homes a year. But it also shows that many of these potential densification projects are not viable without subsidy, particularly in London’s suburbs.

With the Mayor and central government opposed to building on the green belt and brownfield land in limited supply, it is widely assumed estates are a valuable means of boosting housing supply. Yet we still know astonishingly little about the capital’s existing local authority estates.

This report, Another Storey, seeks to understand the potential for estate densification by analysing the density of London’s existing estates, their capacity for densification and the factors affecting the viability of estate densification projects.

By analysing large housing estates in four London boroughs – Lewisham, Barking and Dagenham, Waltham Forest, and Hounslow, Centre for London also finds that:

  • The densification of large estates has the potential to add between 80,000 and 160,000 homes across London over 20 years. Given the length of such projects, the report estimates this could add between 4,000 and 8,000 homes to London each year – up to 20 per cent of London’s additional annual housing target.
  • With the exception of those in Lewisham, large estates were already as dense as their average surrounding ward densities.
  • Three out of the four boroughs could gain an uplift in housing estate capacity of at least 50 per cent by increasing the density of large estates to ‘urban’ levels.
  • Densifying estates up to the ‘central’ setting would produce substantial housing gains in all four boroughs except Waltham Forest.

On viability and costs the report finds:

Delivering more homes overall, while maintaining or increasing the supply of affordable housing, poses challenges in terms of viability.  The report identifies three principal factors that influence this:

  1. The before- and after-values of the housing stock.
  2. The potential for increase in density.
  3. The tenure mix at the beginning and at the completion of the project.

The report highlights that gains to a local authority of densifying a low-density suburban estate are far lower than the preparation costs – in particular, the costs of buying out those who have bought their property through Right to Buy. There is a clear difference between the amount of compensation given to tenants and that given to owners – two variables which rarely feature in viability assessments.

In light of these findings, the report recommends that:

  • A full analysis of where London’s existing estates are, and their current densities, should be used to inform the next iteration of the London Plan. The Mayor should use this analysis to identify the potential for estate densification.
  • Densification should not stop at the edge of housing estates. We recommend an approach that combines densification both of estates and other uses such as privately owned residential land and publicly held land such as car parks.
  • Where suburban, low-density estates are densified, this should be supported by a programme of gap funding if necessary.  This could be through a combination of central government grant, housing association cross-subsidy, private finance through stock transfer, and local authority contribution.
  • Home Loss Payments should be increased to ensure the fair treatment of tenants in the demolition and densification process.

Kat Hanna, Research Manager at Centre for London said:

“At a time when housing is in short supply, it’s absolutely right that all options for building more homes are explored. There is untapped potential in London’s large estates. However, our research has shown that realising this would require a significant step change, in terms of acceptable densities, subsidy, and the fair treatment of existing tenants and owners”.

James Murray, Deputy Mayor for Housing and Residential Development said:

 “The Mayor has already started working with local councils, housing associations and developers on a good practice guide for estate regeneration in London. He will also be consulting with Londoners and community groups across the capital, which is one of the key recommendations set out in this Centre for London report.

“Sadiq has been clear that his new guidance will make sure that where demolition is involved, there should be no net loss of social housing, full rights of return for tenants and a fair deal for leaseholders.”

Richard Cherry, Chief Executive of Partnerships at Countryside Properties said:

“Economic and demographic changes and planning policy all play an important role in fuelling the need for additional housing and the importance of building communities. We are delighted to have supported this prominent report which makes a major contribution to not only better understanding the scope to generate new homes through estate regeneration, but also the financial constraints of doing so.”

Gareth Crawford, Head of Development (South) at Home Group said:

“This report backs up Home Group’s experience of estate regeneration throughout the UK. As we’ve seen, most notably at our Rayners’ Lane regeneration project in Harrow, it is possible to both increase stock numbers while at the same time improving a number of social indicators including crime rates, employment and social cohesion. But this is only possible through partnership working with local authorities and developers committed to engaging with the local community.”

Notes to editors:

  • This report was generously supported by Countryside Properties and Home Group.

About Countryside Properties:

Countryside is a leading UK home builder specialising in place making and urban regeneration. For the year ended 30 September 2015 they completed 2,364 homes with revenues of £615.8m.

Countryside’s business is focused on place making which they deliver through their two divisions, Housebuilding and Partnerships. The Housebuilding division, operating under the Countryside and Millgate brands, develops sites that provide private and affordable housing, on land owned or controlled by the Group. Their Partnerships division specialises in urban regeneration of public sector land, delivering private and affordable homes by partnering with local authorities and housing associations.

Countryside was founded in 1958. It operates in locations across London, the South East and the North West of England.

For further information visit and follow @CountrysideProp on Twitter for the latest news.

About Home Group Limited:

  • Home Group is one of the UK’s largest providers of high quality housing and supported housing services and products.
  • Home Group is a social enterprise and a charity (Charitable Community Benefit Society No. 22981R) with a turnover of £350.8m.
  • Their mission is “to help our customers and clients to open doors to new opportunities and healthy lives.”
  • Home Group provides general needs housing and supported housing services targeted towards helping some of society’s most vulnerable people take control of their own lives. They:
    • House more than 120,000 people a year in 52,000 homes across 200 local authority areas in England, Scotland and Wales.
    • Work with almost 30,000 vulnerable people through 500+ supported housing, justice and health services each year.
  • Care and Support services focus on housing related support, criminal justice and health services.

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