Will Mandatory Inclusionary Housing Create Mixed-Income Communities? Evidence From London, UK

Mandatory inclusionary housing, which requires market-rate housing developments to include a proportion of affordable housing units, has the potential to deliver affordable housing in more affluent neighborhoods and create mixed-income communities. This study evaluates this potential effect in London, United Kingdom, where mandatory inclusionary housing has been implemented in all local authorities since the early 2000s. Comparing the spatial concentration and average neighborhood characteristics of affordable housing delivered under inclusionary housing and those created via conventional means (i.e., in the public or nonprofit sector), we find that a higher percentage of inclusionary affordable units are concentrated in a small number of neighborhoods, and both types of affordable units are more likely to be placed in disadvantaged neighborhoods than market-rate units are. We explore the ways in which local implementation of inclusionary housing could have allowed developers to shift some of the inclusionary affordable housing toward disadvantaged neighborhoods.