The move received a cautious welcome from the RICS. RICS Housing Policy Panel Chairman, Michael Newey, said: "The lack of a clear regional housing policy has led to a major shortfall in housing, especially in London and the South East, with a knock-on effect on house prices. The proposed new regional bodies designed to bring together planning and housing investment could help ease that shortfall and increase the supply of new homes, which is at its lowest since 1924. But any extra spending has to be carefully targeted and properlymanaged if the problem of lack of low cost housing in high demand areas isto be met."

London Mayor Ken Livingstone was more effusive. He said the announcement was "a 'vital boost for London's public services, economic competitiveness and the quality of life of all Londoners." And he added: "The extra £1.1 billion ($1.7 billion) announced for investment in housing should provide the resources needed to achieve my draft London Plan target that 50% of all new homes in London should be affordable."