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Set against a background of enduring austerity and an accelerating housing crisis, local authorities in London have started assuming a greater role in the land development process. Since 2012, a growing number of local authorities have established council-owned private companies to provide homes at a wide range of price points. The problem is that in the absence of subsides, few of the homes are at the lowest, social rents. Local authorities’ revived role in housing production has in turn raised a series of questions about recent transformations in urban governance under neoliberalism and about the role of real estate therein. Drawing on a historical and relational approach to urban political economy, this study documents the revived role of local government in housing production through an in-depth analysis of four local authorities in London, each illustrating the different drivers and motivations underpinning the use of housing companies in the capital. I investigate why, how, and to what end local authorities in London have started building and acquiring homes through local housing companies, and with what effects. In the process, I explore how the relations of risk and power associated with the ownership, financing and development of public land are re-organized along the blurry line between the state and the market. The findings of this research are based on 24 in-depth interviews with key actors conducted between 2017 and 2019 and on the study of publicly available policy documents.I find that housing companies have emerged out of a complex interaction of forces including deep cuts to local government, the defunding of social housing, the restructuring of the welfare system, the post-crisis boom in house and land prices, the deepening housing affordability crisis, and local authorities’ access to historically low interest rates on their borrowing from the Treasury. At the local level, the extent to which local authorities commodify their property is contingent on several factors including their fiscal capacities, their access to land, the conditions of their local housing markets, their relationship to the development industry, and their political orientations. Some councils like Newham have monetized their land assets to generate a revenue stream for municipal purposes. Others like Croydon and Ealing are building homes for market sale or rent to cross-subsidize homes for households on their waiting lists for social housing. Enfield and Croydon have also acquired homes from the open market to let them to homeless residents. Local authorities revived role as housing producers and land developers both supports and diverges from emerging theorizations of urban governance after the crisis. The marketization and commercialization of state-led housing provision have indeed heightened local authorities’ potential exposure to market risks, such as an increase in interest rates or a downturn in rental markets. However, contrary to prevailing conceptualizations of the role of private finance capital in urban policy, local authorities in London have for the most part circumvented financial markets by borrowing directly from the central state. There are some exceptions. As seen in Croydon’s partnership with an institutional investor, continuing austerity may push more local authorities to borrow from capital markets in the future.