Small sites, big ideas

London’s housing headlines seldom make for cheerful reading of late. Private housing starts have collapsed throughout 2025, marking a historic low as the industry points to safety regulator bottlenecks, ever-rising costs and nerves around finance.

Yet beneath the noise, a quieter story of delivery is taking shape across London’s small sites delivery. From neglected garage courts to tricky infill plots, previously overlooked sites are being brought back to life for much needed new housing. PRD’s work with the Greater London Authority (GLA) on the Small Sites Small Builders (SSSB) programme has shone a light on this, identifying one thing above all: small sites succeed when landowners plan strategically, manage risk early, and curate the right delivery partners.

But before we unpick the ‘how’, we need to understand the ‘why’. Small sites have a great role to play in meeting London’s housing targets, given the target for homes on sites under 0.25ha across London is just shy of 120,000 homes over the next ten years. They account for much of the capital’s developable land, yet remain underused, despite their potential to deliver thousands of homes each year. Our ongoing work with inner London boroughs has underlined this familiar paradox: that small sites exist and the demand is clear, but the pathway to delivery route is complex. In this case, boroughs have a swathe of small site opportunities that could make a meaningful contribution to housing targets, yet most remain outside the council’s current delivery model. The opportunity now lies in finding a mechanism that bridges that gap.

London needs around up to 88,000 new homes annually; these smaller plots offer one of the few delivery levers still within reach. Their scale can allow for faster decisions and more meaningful engagement with local communities. We posit that small sites are the most agile part of an otherwise sluggish market.

1. Start with strategy, not with listings

With mounting pressures to secure capital receipts, some boroughs naturally consider the disposal of their small sites in isolation rather than developing a strategic programme of delivery. Yet our review of almost 70 SSSB sites revealed that the most successful authorities began with a clear brief that is rooted in purpose.

That purpose may vary given the differing priorities of different places. Boroughs may choose to prioritise key worker, or social rental housing provision, or to grow its SME and design-led development community in a bid to reinvigorate the small builder market that is still recovering from the pandemic. Emerging priorities for some boroughs may seek to tackle mounting temporary accommodation pressures – our recent research has identified that 98% of private rental properties in Outer East and Outer Northeast London were unaffordable to residents reliant on Local Housing Allowance. As rents outpace benefits, more households are turning to councils for support, and cost is unsurprisingly spiralling. London Councils recently reported that boroughs are now spending £5.5m each day on homelessness, the majority of which goes on Temporary Accommodation (TA).

A clearly defined purpose gives officers a stronger case for public funding or de-risking support measures, and a framework to prioritise sites, align budgets and monitor outcomes. Programmes that explicitly target issues such as TA or key worker housing may well be easier to justify in business cases to secure public funding support, as the outcomes directly address borough-level pressures.

The purpose provides the foundation for the pathway to delivery. For example:

• If the strategic goal is to maximise affordable housing, then developing a programme of batched sites can make the offer to Registered Providers (RPs) more compelling: it creates volume and drives management efficiency once the housing is operational.
• If the goal is capital receipts, then single-plot, clean-title disposals to engaged SME developers are more effective, supported by the right due diligence to minimise unforeseen delays.

Without a defined strategy, officers may get lost between the two, and the pipeline stalls before it ever starts.

2. Match the site to the right kind of developer

Our review of the SSSB network categorises active market participants, from SME housebuilders to registered providers, architect-developers and contractors. Each plays a distinct role:

• Architect-developers typically thrive on constrained micro-sites (1–9 homes), requiring design ingenuity but modest financing.
• Registered Providers typically require scale (15 homes plus) to make management and borrowing stack up.
• Contractor-developers typically perform best where viability challenges are a key threat to delivery and value-engineering can unlock a scheme.

Treating all “small” sites the same leads to mismatched bids and failed disposals. Curation streamlines officer time and helps secure the right delivery partner.

3. Manage risk intelligently

Risk is the defining constraint for most small developers and architect-led practices. Few have the balance sheets to carry long pre-development periods, unpick complex site issues, or absorb sudden cost hikes. That’s where the public sector’s enabling role becomes critical. The GLA’s SSSB programme has allocated targeted revenue funding which has helped boroughs commission essential due diligence that unlocks delivery, from utilities mapping to ground investigations. The lesson is simple: proactive risk management doesn’t diminish control, it enables delivery. With a clear, consistent framework in place, smaller partners can focus on what they do best, from good design to efficient construction, bringing sites to life in the process.

4. Leverage local expertise

For resource-stretched councils juggling multiple priorities, that extra layer of market knowledge can make the difference, turning a dormant portfolio of sites into a live and deliverable pipeline. One public sector body’s decision to appoint an agent as an intermediary underlined the value of their role in the market, matching site opportunities with the right developers rather than taking sites to the open market or a static mailing list.

5. Keep the feedback loop alive and long-standing

Developers told us that a light-touch, human connection, from a named officer or single point of contact, is critical throughout an often-knotty development lifecycle. The GLA’s Support Pathways formalise this idea: offering opportunities for capacity-building for community-led developers and regular knowledge-sharing amongst landowners. It’s the connective tissue that keeps small-site delivery moving when bumps in the road are met.

Small sites have an important part to play in delivering housing

Small sites aren’t a side project. Rather, they are a test of a council’s whole development culture: how it manages risk, values land and works with both the market and community. At a time when London’s larger schemes are slowing, these modest plots offer something increasingly rare: momentum.

The Small Sites, Small Builders programme shows that when landowners plan with purpose, structure risk appropriately, and curate the right partners, even the knottiest corners of the built environment can deliver homes. It’s not the size of the site that determines success, but the clarity of intent wrapped around it.

Across PRD’s work, from the SSSB programme to wider support for boroughs in unlocking housing, the message remains the same. With a strategic framework and a committed delivery route, small sites can move first and move faster to help boroughs make progress against difficult housing targets.

Find out more about the GLA’s programme here