Government Caps Ground Rents at £250
The UK Government has announced a significant reform to the leasehold system, introducing a cap that limits ground rents to £250 a year before reducing them to a peppercorn after 40 years. Ministers describe this as a major step toward ending the “feudal” leasehold model, with the Prime Minister stating that the cap will save many households hundreds of pounds annually during a challenging period for the cost of living. The changes sit within the draft Commonhold and Leasehold Reform Bill, which aims to strengthen homeownership, modernise property law and extend new protections to more than five million current and future leaseholders.
For the property industry, the ban on new leasehold flats and the push toward commonhold signal a decisive shift in how multi‑unit developments may need to be structured. Developers may face adjustments to tenure strategies, while agents could benefit from a market less inhibited by escalating ground rent clauses that have historically slowed sales or complicated mortgage approvals. The Government believes the cap will help unlock stalled transactions, improve buyer confidence and ultimately create a fairer and more transparent environment for both homeowners and professionals across the sector.
Government Expands Social Housing to Support Thousands More Families
The Government has announced a major expansion of social and affordable housing, confirming that thousands more families will gain access to warm, secure homes as part of the biggest boost to grant funding in a generation. The package includes significant new financial support for councils, housing associations and other providers to accelerate the construction of social and affordable homes, helping to reduce the record numbers of families currently stuck in temporary accommodation or on waiting lists. Alongside this, landlords will be required to meet strengthened standards through an updated Decent Homes Standard for the first time in 20 years, ensuring homes are free from damp and disrepair, better insulated and more energy efficient. These changes are designed to cut the cost of living for social tenants, with new Minimum Energy Efficiency Standards expected to save households hundreds of pounds a year in energy bills.
The announcement comes ahead of the opening of the £39 billion Social and Affordable Homes Programme bidding window next month, which aims to deliver around 300,000 new social and affordable homes over the programme’s lifetime. At the same time, councils will gain new freedoms to build more homes without the administrative burden of opening a Housing Revenue Account, enabling local authorities that have not built for years to restart development at pace. The Government will also introduce measures to tackle blockages in Section 106 delivery and work directly with providers and developers to keep the affordable housing pipeline moving. Together, these actions aim to deliver long‑term security for families and drive a new era of social housing renewal, ensuring that homes are warmer, safer and more affordable for millions.
Half of UK Homes Rise in Value in 2025, Zoopla Finds
New analysis from Zoopla shows that around half of the UK’s 30 million homes approximately 15.2 million properties rose in value during 2025, with the average increase sitting at £9,900. The data reveals sharp regional divides: more than 70% of homes in northern England, Scotland and Northern Ireland saw price growth, with Northern Ireland leading the way as 94% of properties increased in value by an average of £14,200. Scotland and the North West followed closely, recording rises for 73% and 72% of homes respectively, cementing these areas as the strongest performers in the 2025 market. In contrast, 9.1 million homes across the UK saw values fall by at least 1%, and six in ten of these were located in southern England, where affordability pressures and wider buyer choice contributed to weaker price performance.
Property type also played a major role in market movement. Terraced and semi‑detached houses proved the most resilient, with 56% increasing in value, while flats were more likely to record declines, reflecting a tougher market for higher‑density urban stock. Meanwhile, standout local authority areas included Renfrewshire, where 95% of homes increased in value, and Waltham Forest, which, despite London’s broader underperformance, saw 59% of homes rise by an average of £26,600. Overall, Zoopla’s assessment paints a housing market defined by strong regional divergence and shifting buyer preferences, factors expected to influence pricing and competitiveness as the market continues adjusting into 2026.
Housing Secretary to Meet Housebuilders on 1.5 Million Homes Target
The UK Housing Secretary, Steve Reed, is set to meet with the country’s largest housebuilders to discuss how government and industry can work together to deliver the ambitious target of 1.5 million new homes. According to reporting from AJ Bell, Reed and Chief Secretary to the Treasury James Murray will hold a roundtable with major developers including Vistry Group and Barratt Redrow to explore proposed planning reforms, assess current market conditions and outline how both sides must “rise to the challenge” of easing the housing crisis. A source close to Reed emphasised that while “green shoots of recovery are showing”, neither government nor industry can afford to be complacent—highlighting renewed urgency in overhauling planning rules, releasing land and accelerating investment to get more homes built.
The meeting also comes ahead of the next phase of the Government’s pro‑growth reforms and the expansion of the New Homes Accelerator, which is focused on speeding up the delivery of large-scale developments across England. Early signs of recovery in the sector will be discussed, but Reed will stress that too many families remain locked out of homeownership. Senior figures from Persimmon, Taylor Wimpey and the Royal Town Planning Institute are expected to attend, reinforcing the Government’s intent to work in close partnership with the industry to deliver on its pledge. Reed is expected to reiterate that only by collaborating can the UK meet the 1.5 million homes ambition within this Parliament.
Study Reveals 84% Collapse in London Housebuilding Since 2015
A new study by consultants Molior shows that private‑sector housebuilding in London has plummeted by 84% since 2015, with just 5,547 construction starts recorded in 2025 compared with 33,782 a decade earlier. The capital is estimated to need around 88,000 new homes each year, yet only 18,326 completions are expected by year‑end—roughly half of what is currently under construction. A further 14,053 homes may not complete until 2027 or later, representing just 8% of the government’s two‑year, 176,000‑home target for London, leaving a shortfall of 92%. The slowdown is also reflected on stalled construction sites: work has been halted on 5,009 homes across 51 developments, which Molior attributes to contractors going bust amid rising construction costs or pausing work due to a weak sales market. Only 8,436 homes were sold in London in 2025, far short of the 22,000 quarterly sales Molior estimates would be needed to meet government targets.
Lord Bailey of the London Assembly described the situation as having shifted “from difficult to devastating”, arguing that the Mayor’s approach has “stifled development, slowed delivery, and left Londoners paying the price through rising rents and soaring house prices”. Meanwhile, City Hall pointed to external pressures the “disastrous legacy of the previous government”, high interest rates, rising material costs, the pandemic, Brexit and delays linked to the Building Safety Regulator as key contributors to the slowdown. A spokesperson for the Mayor said housing delivery remains a top priority, highlighting a record £11.7bn available through the Mayor’s Affordable Homes Programme, a new £322m City Hall Developer Investment Fund to support large‑scale schemes, and government backing for an extension of the Docklands Light Railway to Thamesmead, expected to unlock up to 30,000 new homes.
