BLOGS

A target that dwarfs recent delivery

London's new annual housing requirement under the revised National Planning Policy Framework (NPPF) has landed at 87,992 homes a year. To put that in context, the capital hasn't delivered anywhere close to that figure in over a decade. Annual net completions in London have typically sat in the 35,000–40,000 range in recent years, meaning the new target implies roughly a doubling of current output.

For developers, lenders and investors, the number itself matters less than what it signals: a renewed push for local authorities to allocate land, speed up decisions, and justify green belt or brownfield release where supply is constrained. The revised standard method removes much of the discretion councils previously had to argue their way down from centrally calculated figures, which means the gap between target and delivery is about to become a much more visible political and commercial issue.

Why the number moved

The revised NPPF recalibrated the standard method formula, leaning more heavily on affordability ratios and stock uplift assumptions than the previous approach. London's high price-to-income ratio pushes its number up disproportionately compared with regions where affordability pressure is less acute. The result is a target that borough leaders are already describing as difficult to reconcile with land availability, especially in outer London boroughs with limited brownfield capacity.

Borough-level pipeline pressure will be uneven

Not every borough faces this pressure equally. REalyse's planning pipeline data tracks live and historic applications by unit count, site area, and status across every London local authority, and the picture it shows is one of concentration rather than even distribution. A handful of boroughs — typically those with large brownfield regeneration zones such as former industrial land in east and southeast London — already carry a disproportionate share of consented units in the pipeline. Others, particularly lower-density outer boroughs with significant green belt coverage, have comparatively thin consented pipelines relative to their new targets.

This matters for anyone underwriting development sites. A borough with a large gap between its NPPF target and its consented pipeline is one where planning risk is elevated but also where councils face the strongest pressure to grant permissions, approve density uplifts, or release marginal land. Cross-referencing planning application data with land parcel flags for brownfield and greenbelt status is a useful way to identify where that pressure is most likely to translate into new sites coming forward, rather than just where it's talked about.

Build-to-rent as a release valve

One area worth watching closely is Build to Rent (BTR). BTR schemes tend to move through planning faster than build-for-sale, partly because they're often backed by institutional capital with less exposure to sales-market timing risk. REalyse's planning data separately tracks BTR unit volumes within the broader application set, and boroughs actively courting institutional investment may lean on BTR consents to narrow the gap between target and delivery, even if freehold family housing supply remains constrained.

What this means for land values

Higher targets, if they translate into genuine pressure to release land, should in theory increase the pool of developable sites and take some heat out of land values in supply-constrained boroughs. In practice, the transmission mechanism is slower and messier. Land values respond to viability as much as to policy: build costs, planning timelines, and achievable sales or rental values per square foot all feed into what a site is worth to a developer.

REalyse's sold price per square foot data by borough and property type gives a useful anchor for viability modelling here. Where achieved sales values have been flat or softening — a pattern visible across parts of inner London over the past two years — a higher housing target alone won't be enough to make marginal sites stack up. Conversely, boroughs where price per square foot has held up or grown, combined with a genuine loosening of planning constraints, are the more likely candidates for land value uplift as allocations expand. Comparing borough-level asking-to-achieved price discounts alongside days on market can also flag where demand is strong enough to support new supply without denting values.

Lender and investor implications

For lenders assessing development finance and for investors underwriting sites, the revised target changes the risk conversation rather than resolving it. A larger official number doesn't guarantee faster permissions or lower risk premiums; if anything, boroughs under the most pressure may see more contested applications and longer committee timelines in the near term as councils work out how to respond. Tracking planning application status and decision timeframes at the local authority level — rather than relying on the headline target — is the more reliable way to gauge where delivery risk is actually easing.

Outlook

The 87,992 figure is a useful signal of intent, but it's the borough-by-borough response that will determine whether it reshapes delivery in practice. Expect wide variation: some authorities will lean into brownfield regeneration and BTR to close the gap, others will contest allocations or lean on green belt reviews, and a number will simply fall short without meaningful consequence in the short term.

For anyone active in London development or investment, the practical takeaway is to treat the national target as context, not a forecast. Borough-level pipeline data, consented unit volumes, and achieved price and rent trends remain the more reliable guide to where housing delivery — and the land value uplift that comes with it — is genuinely likely to happen over the next few years.