London’s Mayor, Sadiq Khan, has introduced a bold initiative to create rent-controlled homes aimed at making housing more affordable for the city’s key workers. The proposed Key Worker
Living Rent (KWLR) homes could save tenants up to £600 a month by capping rents at 40% of key workers’ average household incomes, with potential rent adjustments linked to wage growth.
This proposal is part of the Mayor’s 2024 manifesto pledge to address the housing affordability crisis by providing rent-controlled homes in addition to existing social housing. These homes are specifically designed for those on moderate incomes who don’t qualify for social housing but find private rents unaffordable. The initiative aims to deliver at least 6,000 homes by 2030.
KWLR homes will cater primarily to key workers, including nurses, teachers, bus drivers, and retail staff—professions that represent about a third of London’s workforce. The Mayor’s rent model ties affordability to post-tax incomes, offering a simpler and fairer approach for renters and housing developers alike.
With Londoners facing steep housing costs—24% of private renters currently spend over half their gross income on rent—this initiative could significantly ease financial pressures. Nearly 40% of renters report they are only just managing financially, while others are forced to cut back on basic needs or rely on debt.
For the first time, rent increases for these homes may be tied to wage growth rather than market trends, ensuring affordability over time. This approach mirrors affordability measures already included in the Mayor’s London Plan.
The Mayor has launched a public consultation to refine the proposals, inviting feedback from key workers, their employers, housing developers, and affordable housing providers. Their input will be instrumental in shaping this groundbreaking housing model and ensuring its success.
KWLR homes expand on the success of the London Living Rent program, incorporating stronger links to key worker incomes and a streamlined rent-setting process. These homes are intended to complement—not replace—social housing, targeting those who fall between social housing eligibility and the private rental market.
The Mayor’s initiative represents a significant step toward addressing London’s housing crisis by creating a new tier of genuinely affordable homes for essential workers who keep the city running.
As the consultation progresses, the Mayor encourages all stakeholders to share their insights and ideas to help shape the future of affordable housing in London. By 2030, these homes could provide a lifeline to thousands of key workers struggling with the city’s high cost of living.
The Mayor of London, Sadiq Khan, said: “I am determined to do everything in my power to make housing more affordable for Londoners. The housing crisis in our capital doesn’t just affect those on the lowest incomes, it impacts those on ordinary incomes who struggle to meet high housing costs in London.
“That includes the everyday heroes who are the backbone of our city – our nurses, teachers, bus drivers, shop workers, and cleaners. To deliver on my manifesto commitment, we want to introduce new rent-controlled homes for Londoners, which could save key workers up to £600 per month on their rent.
“I welcome views from all Londoners on how we can make this new type of housing a success, for the thousands who need and deserve a more affordable home, as we build a fairer London for everyone.”
Ben Twomey, Chief Executive of Generation Rent, said: “While the cost of renting crisis continues to rage across the capital, it is welcome that the Mayor of London is looking at new ways to protect people from soaring rents.
“We rely on key workers for our communities to function. They build our homes, look after our health and educate our children, so everyone benefits when they can afford to live near their workplaces. Generation Rent encourages tenants and key workers to have their say on these new proposals.”
UNISON London regional secretary Jo Galloway said: “This is a crucial step in tackling the housing crisis facing London’s key workers. It should help deliver more safe, secure and affordable homes for staff who keep the capital's vital public services running.
“UNISON has long campaigned for a fairer rental market and for essential workers’ voices to be heard and represented.”
Regional Director for the Royal College of Nursing London region, Lisa Elliott, said: “Accommodation costs in London are rising at an astronomical rate and nursing pay has not kept pace. More and more nursing staff are telling us that high accommodation costs are pushing them into financial difficulty. In a survey of our members earlier this year, 56% said they plan to leave London in the next five years, and 58% of these cited the lack of affordable housing as the main reason.
“London’s health and care system desperately needs to retain its nursing staff. It’s crucial that politicians, employers, and other key stakeholders work constructively together to make homes genuinely affordable for London’s nursing community, and we want to support that ambition.” Photo by U.S. Embassy London, Wikimedia commons.