An investigation by the London Assembly reveals that soaring land prices are driving developers to create taller residential buildings in the capital. Rising acquisition costs compel construction firms to increase floor counts to ensure profitability. Influencing factors include the ongoing war in Ukraine and financial obligations from Section 106 agreements, which require cash contributions for local infrastructure. Although recent trends show a slowdown in tall building completions, experts emphasize that the challenging housing market leads to fewer projects across all types, signifying a difficult period for construction in London.
Rising construction costs and high land prices have compelled developers in London to construct taller buildings, aiming for higher unit counts to ensure project viability.
Developers must deliver a minimum number of units to make projects financially viable, prompting them to increase building heights in response to soaring land costs.
The overall number of tall residential buildings in London has decreased due to broader challenges in the housing market, despite pressures for height.
The London housing market is facing unprecedented difficulties, with construction slowing significantly as developers grapple with rising costs and market viability.
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