Town Hall welcomes £39bn housing boost but warns of construction costs

Executive member for homes and neighbourhoods Cllr John Woolf in the Town Hall chamber. Photograph: Josef Steen / free for use by LDRS partners

Islington Council has welcomed the government’s pledge to nearly double spending on affordable housebuilding, while warning that costs and regulations have made it harder than ever to build.

On Wednesday (11 June), Chancellor Rachel Reeves unveiled a £39bn boost to the housebuilding sector – including for local authorities to build new social housing – as part of the government’s day-to-day spending review.

Islington’s housing chief said the news offered “genuine hope” that Downing Street shared Upper Street’s commitment to deliver genuinely affordable homes.

“However, factors including rising construction costs, new building safety regulations, and ongoing inflation have made it arguably more challenging than ever to build new homes,” said Cllr John Woolf.

In a statement to the Citizen, he said the council still needed to “carefully scrutinise the details” of the review.

Woolf highlighted that Islington currently had roughly 34,000 households either waiting for social housing or living in temporary accommodation.

“These aren’t just numbers – they’re families, individuals, and children facing daily uncertainty.”

He added that, since 2009, the council had delivered more than 615 new council homes, and had also bought back 643 ex-Right to Buy (RTB) properties since 2020.

Last year, a Freedom of Information request (FoI) revealed the local authority had spent around £146  million on repurchasing ex-council homes.

This is more than any of the other England councils that responded to the FoI probe.

In March, the Citizen reported the council had so far bought back 552 RTB properties and had exchanged a further 110.

At the time, the Town Hall stated it was set to procure 245 more of these homes before the end of the current financial year.

Reacting to the Chancellor’s announcement, the borough’s Green opposition group said the new investment in housing was “long overdue”.

“Every street in Islington will hold a story of how bad the housing crisis has gotten in our borough,” said Leader of the Opposition, Cllr Benali Hamdache.

“But the devil is in the detail. How much of this funding will be for social housing? How much will be spent in London – or, like funding for new transport, will other parts of the country be prioritised?”

Islington’s Independent councillors were also contacted for comment, but at the time of writing had not responded.