Earlier this week, John Tutte, Group CEO of Redrow, explained that requiring 50% of housing development to be affordable homes should instead apply on a citywide or national scale.

Speaking at Instinctif’s ‘The Great Housing Market Debate’ on 17^th May, John said: “It seems ridiculous to me to have a scheme in Mayfair that has to provide affordable housing on site when actually you could probably provide 10 times the level of affordable housing in some other London boroughs for what it would cost to do it in Mayfair.”

“The primary objective should be to deliver more affordable housing and we shouldn’t get hung up with tenure.”

John’s comments followed a discussion over the economic impact of affordable housing, in which he warned that developers could suffer as a result of affordable housing.

“There’s only so much that developments can carry, in terms of their commerciality and to a certain extent their saleability.

“Very high levels of affordable [housing] can have an impact on rental and sales prices for private homes.”

Sadiq Khan’s manifesto also pledged to create a new form of affordable housing, with rent based on a third of average local income.

Ashley Ilsen, Head of Lending at Regentsmead, voiced concerns over the financial wellbeing of developers under the new mayor.

“Developers are, of course, incentivised to sell their products at the best market value possible, and by trying to control the market in this way we could see the developers bear the brunt of the shortfall.”

Indeed, Rico Wojtulewicz, Policy Adviser at the National Federation of Housebuilders, complained that “developers are not treated equally under the current conditions”.

“These contributions have placed a disproportionate burden on SME housebuilders, who are already under significant pressure,” Rico explained.

This has finally been reflected in the government winning an appeal against Reading and West Berkshire Council on the exemption of small sites from affordable housing contributions.

Bob Sturges, Head of PR and Marketing at Fortwell Capital, concurred that profit remained key to any development.

“Private housebuilders and developers are not charitable or philanthropic organisations.

“Their purpose - unashamedly market driven - is to build or refurbish homes for sale at a profit.

“In doing so they are helping [to] fulfil a vital task long since largely abandoned, and certainly neglected, by the public sector.”

However, Bob conceded that firms had a certain duty as the nation’s homebuilders.

"That said, private firms fully accept they have a crucial and responsible part to play in delivering the type of affordable-housing schemes the country obviously needs.

“But there is a limit to the amount of profit-dilution this brings about … [and] pushed too far, builders and developers will walk away.”

As an alternative to Sadiq Khan’s plans, John Tutte suggested that the affordable-homes quota should be applied on a broader scale.

“It’s difficult to provide 50% on each individual development, but perhaps the new mayor should look at providing 50% of the new homes across London.”

Scott Marshall, Director at specialist lender Roma Finance, offered a different solution, suggesting that the government makes affordable housing more appealing in the first place.

"I don't think the government can legislate on the number of houses each individual developer has to build, but it can make it easier through local targets, speeding up planning permission and reducing red tape,” he added.

Regardless of how the government chooses to fix the supply issue, Scott warned that the decision should be made quickly.

“However, the government needs to continue to stress the urgency of the situation and to maintain momentum on this national crisis to make sure the cupboard is not left bare for future generations."