Westminster City Council has unveiled a radical new housing policy that will force developers to allocate a significantly higher proportion of new homes for social rent, a move hailed by the council but met with caution by industry experts.
A Major Shift in Affordable Housing Policy
The council's 'City Plan Partial Review' introduces much stricter rules for property developers. The most significant change is a sharp increase in the requirement for social rent homes within new developments, rising from 40% to 70%. Consequently, the allocation for intermediate rent homes – another form of affordable housing – will be reduced from 60% to 30%.
In a groundbreaking expansion of the policy, sites proposing fewer than 10 homes will now also be required to contribute to affordable housing targets. This includes developments of just a single unit. According to the policy, contributions can be made as a financial payment to the council's Affordable Housing Fund instead of physically building the homes, calculated on a price per square metre basis.
Experts Warn of Potential Backfire
While the council frames the policy as a vital step towards a fairer city, property industry representatives have expressed serious concerns. Thomas Douglas, Head of Policy and Campaigns at Propertymark, warned that the increased quota might deter development altogether.
"Westminster City Council must be confident that a change in quotas is viable to be delivered," he stated. "Without this, increasing the quota could have the opposite effect, creating a real risk that fewer development schemes come forward, thereby slowing housing delivery across all tenures."
This local policy shift comes just months after a contrasting move by central government. In October 2025, Mayor of London Sadiq Khan and Housing Secretary Steve Reed announced a reduction in the affordable housing requirement for major London developments from 35% to 20%, aiming to stimulate construction.
Retrofit First and Strategic Sites
The review, shaped by three years of consultation, also strongly reaffirms the council's 'Retrofit First' policy. This mandates developers to exhaust all reasonable options for refurbishing existing buildings before considering demolition. The council claims this approach has already saved an estimated 27,000 tonnes of CO2 since 2023.
Councillor Geoff Barraclough, Cabinet Member for Planning, said the combined policies set a "new benchmark for local authorities." He added: "It will help reduce carbon emissions... and has the potential to be the biggest single emissions-reduction initiative undertaken by any council in the country."
The plan identifies four strategic sites for future mixed-use development:
- St Mary's Hospital
- Westbourne Park Bus Garage
- Land adjacent to Royal Oak
- Grosvenor Sidings
However, the policy faces political opposition. Councillor Paul Swaddle, leader of the council's opposition, criticised the cut to intermediate housing, stating it would make it "almost impossible for people who work in Westminster to continue living here," pushing out key workers like nurses and teachers.
The debate unfolds against a severe housing shortage. Official data shows that in the 2023-24 period, approximately 336,000 households in London were on a Social Housing Register, the highest number in over a decade.
