South needs 1m extra homes

London will grow by an extra 860,000 people by 2016 and there will be more than a million more households in the south of England by 2010, equating to some 2.3 million more people, a report warns today.

The projections, by consultancy Cambridge Econometrics, threaten a significantly faster population growth in the region than provided for in Mayor Ken Livingstone's London Plan, launched in June. The Mayor's plan is based on numbers only rising by 700,000 by 2016.

The report follows last month's announcement by Deputy Prime Minister John Prescott that 200,000 more new homes would be built in the South-East to make property more affordable. If correct, however, the new figures would eclipse that plan.

Cambridge Econometrics says the only solution is a massive increase in housebuilding, which can only happen if there is "a sharp increase in allocated planning targets".