A new £10bn Homes for London agency funded through the bond markets will be the core of Labour mayoral candidate David Lammy’s campaign.
In an exclusive interview with Estates Gazette, the MP for Tottenham said solving London’s housing crisis required state intervention, and that the bond markets offered the most attractive means of financing it.
Lammy’s proposal follows a similar announcement from rival Labour candidate Tessa Jowell, who has proposed a Homes for Londoners agency that would focus on six strategic goals designed to solve the housing crisis but would stop short of building housing itself.
Lammy said: “Given that the government has ended the £4bn grant for housing, we need to find funds in other places. I don’t think you can leave housing just to the private sector. The state has to be an actor and that’s why I think the bond market is the best place to find resources to build again.”
Lammy pointed to the success housing associations have had in raising money from the bond market as proof that London is a “special beast that is attractive to markets”.
Housing associations have become active bond issuers over the past five years as they have sought to diversify their funding sources in the face of government cut backs. The issuance has been met with strong demand from buyers seeking low-risk products that offer steady returns.
Lammy has also called for a London value tax, which would levy a charge on £900,000-plus homes that were left uninhabited for more than three months.
See next week’s EG for the full interview with David Lammy.
