The new London Plan and residential alternatives

The London Plan is the spatial development strategy for Greater London, with strategic policies to inform local planning decisions across London. The current London Plan dates from 2021, with the Mayor required to update it every five years. Accordingly, the Mayor is now considering responses to a recent consultation on a new London Plan.

In order to get anywhere near the Government’s lofty housing targets (with the aim to deliver 1.5 million homes across this Parliament), the new London Plan will need to consider and include alternative forms of housing, particularly:

Co-living 

Co-living accommodation provides a form of communal living where individuals pay an all-inclusive rent usually for a smaller room or studio with access to communal amenities. These spaces are becoming more popular in cities, with large complexes providing a more affordable alternative to the traditional rent model in central locations or close to transport modes. 

In February the GLA published its “Large-scale purpose-built shared living” London Plan guidance providing a framework to support delivery of co-living schemes across London. As part of the new London Plan consultation, the Mayor sought views on the level of demand for co-living accessible housing, and whether the proportion of wheelchair accessible / adaptable rooms in a co-living development should be revisited to better provide affordable homes.

PBSA

Purpose-built student accommodation is specifically designed for students, often with shared facilities such as a laundry area and common room. The PBSA sector has traditionally been under-supplied across the country and so residential developers are now looking to move into this space.

Government guidance acknowledges that policies encouraging purpose-built student accommodation may help ease pressure on the private rented market, reduce the need for Houses of Multiple Occupation and release capacity for family housing. In October the GLA published its own bespoke PBSA London Plan guidance acknowledging the benefits of an influx of students to a local economy.  The Mayor was keen to hear views on whether linking PBSA to particular universities or recruitment plans is a barrier to development, and whether nomination agreements would be best suited only for the affordable element. 

BTR

Built to rent units are designed specifically for longer term renting, with specific S106 covenants restricting sales. This is not a new residential model and is instead becoming an established sector in the UK housing market, allowing companies to retain ownership of large purpose-built portfolios which are professionally managed at scale.

The Government has issued bespoke BTR planning guidance encouraging local planning authorities to undertake a needs assessment so as to identify where BTR units should be encouraged, whilst the current London Plan asks boroughs to take a positive approach to BTR. The new London Plan consultation document acknowledges that BTR may increase delivery and therefore welcomed views on the minimum 50 unit threshold and BTR affordable housing models.

With the delivery of traditional build-for-sale housing schemes increasingly challenging in London it is likely that the Mayor will look to support these residential alternatives in the new London Plan, a draft of which is expected to be published in 2026.