You are viewing 1 of your 1 free articles
Student homes and co-living excluded from London housebuilding support
Student and co-living accommodation will be excluded from the government’s emergency support package for London house builders, officials have said.
Student and co-living accommodation will be excluded from the government’s emergency support package for London house builders, officials have said #UKhousingTax breaks designed to spur housebuilding in the capital will not apply to student or co-living schemes because the relief is aimed at development that “contributes directly to meeting long-term housing need”.
Short-term measures to support housebuilding in London were announced in October after housing starts fell to a 16-year low in the capital. These include up to 80% relief from the Community Infrastructure Levy (CIL), a lower 20% affordable housing target for fast-track planning and the removal of some design guidelines that constrain density.
Developers will be able to apply for 50% CIL relief on schemes with 20% affordable housing, rising to 80% CIL relief on sites with 35% affordable housing, until the end of 2028.
Read more
However, the government revealed in a consultation published on 27 November that it intends to exclude student housing and co-living developments entirely from the CIL relief.
“Only residential developments (excluding student and co-living accommodation) will be eligible for the relief,” it said.
“This ensures that relief is aimed at development that contributes directly to meeting long-term housing need in London, and which is currently facing delivery challenges.”
Officials cited Greater London Authority planning data, which has indicated a shift from self-contained (C3) residential homes to student and co-living developments in recent years.
From 2023 to 2024, they said, the number of C3 homes approved by the mayor of London at Stage 2 fell by 3,177, while the number of student and co-living homes rose by 9,092.
CIL is levied by local planning authorities on house builders to raise funds for infrastructure and mitigate the cumulative impacts of development. The consultation said CIL rates “can be unresponsive to significant changes in viability”, as has occurred in London in the context of rising building costs and “flattening or falling” sales values.
“The government recognises that CIL is an important source of funding for infrastructure to support development of an area,” the consultation said. “However, if development does not come forward due to viability and wider issues detailed above, CIL will not be paid at all.”
Developers must pay a fee of £25,000 to apply for the CIL relief and must have already secured planning obligations, including the amount of affordable housing.
The consultation will run until 22 January 2026.
In August, Inside Housing Living investigated the rise of co-living developments, which could house more than 3.5 million people across the UK according to consultancy Conscious Coliving.
Co-living refers to studio flats with communal living spaces. They are rising in popularity across the UK as a middle ground between house shares and one-bedroom flats, with about 23,000 co-living beds currently in the pipeline, which includes those with permission granted and permission sought.
In August, the west London borough of Ealing said it would limit further large co-living developments, arguing that there was currently no identified local housing need for these schemes.
Sign up to our weekly Living newsletter
Sign up to Inside Housing Living’s newsletter, bringing you exclusive analysis and big deals from the wider residential market, including build-to-rent, student living, later living, for-profit registered providers and more.
Click here to register and receive the Living newsletter straight to your inbox.
And subscribe to Inside Housing Living by clicking here.
Already have an account? Click here to manage your newsletters.
Related stories
