Private new-home sales in London fell to just 1,440 during Q3 2026, highlighting the scale of the challenge facing developers attempting to increase housing delivery in the capital.

Knight Frank, citing Molior data, said sales remain far below the 8,600 homes recorded at the market peak in early 2015.

New-home starts are closely tracking weak sales. Around 7,160 private homes started construction during the first nine months of 2026, broadly matching approximately 7,070 sales over the same period.

Knight Frank said developers cannot sustainably build homes materially faster than they are able to sell them.

The Office for Budget Responsibility said the Government's new Your First Home equity-loan scheme is expected “to only have a marginal impact on house prices and supply given its limited overall size.”

The scheme will allow qualifying buyers to use a 2.5% deposit alongside a 20% government equity loan, reducing the mortgage requirement to 77.5%.

However, Knight Frank said the £4.7bn allocated over five years is unlikely to transform national new-build sales rates.

The scale of London's delivery challenge remains considerable. Meeting the London Plan target of 55,845 homes annually would require private sales, starts and completions to run at around 35,000 homes a year.

Land values are showing tentative signs of stabilisation, with greenfield values down 3% annually in Q3, brownfield down 5% and prime central London down 3%.

However, housing construction remains firmly in contraction, while higher finance costs, planning requirements and weak sales continue to constrain development viability.