Hackney mayor Jules Pipe has backed an “eastern phase” of the £27bn Crossrail 2 project after it was confirmed by George Osborne in his Budget.

Hackney is one of four councils calling for the line to split at Angel and pass through Hackney Central and Hackney Wick into Essex.

Research found huge potential for development in the area could be created by new transport links.

In the next 25 years, Hackney’s population is expected to grow by 89,800 people, with 34,000 jobs created and 40,800 homes built.

The line would halve journey times from Hackney Central to Victoria, Hackney Wick to Tottenham Court Road and Hackney Central to Chafford Hundred and see trains every four minutes between Hackney and Barking.

Mayor Pipe said it was crucial the government backed the idea.

He said: “This new research demonstrates the huge potential it would unlock for growth. The threat to these aspirations by expecting the existing transport infrastructure to cope means it’s crucial the government commits as soon as possible.”

Last week’s announcement of the railway, which will link Hertfordshire and Surrey, also means Dalston is set to get a new station.

Talks are still being held over the location of the ticket hall after protests from people in Bradbury Street, whose homes and businesses were earmarked for demolition.

Transport for London (TfL) said the small side road and the NatWest building in Kingsland High Street were two of five spots it needed for the project, which is expected to launch in 2020.

Last month, families and shops accused Crossrail 2 bosses of “blighting” their lives at a heated public meeting.

People who live and work in the street have been told their homes and businesses could be destroyed to make way for the ticket hall of the new station, but said they had not been told when or even if it was happening.

The company formally apologised for the lack of communication at the February meeting – but still didn’t give firm answers.

However, MP for Hackney North and Stoke Newington Diane Abbott told the Gazette she had met TfL bosses to discuss the impact plans would have on the area.

She said: “They said they were actively looking at moving the ticket hall to where Kingsland Shopping Centre is, and are talking to the council and to the freeholder.

“If it was to move there it would be a reprieve for Bradbury Street.”