Posts with tag: housing association tenants

House Building Must Grow Fivefold to Meet Right to Buy Promise, Warns NAO

House building to replace homes sold through the Right to Buy scheme must grow fivefold to meet the Government’s one-for-one promise, MPs have been warned.

The National Audit Office (NAO) also explains that the Government pledge to replace homes sold through the scheme “does not necessarily mean like-for-like”. It says that replacement properties can be “a different size, and built in a different area, compared to those that have been sold”.

House Building Must Grow Fivefold to Meet Right to Buy Promise, Warns NAO

House Building Must Grow Fivefold to Meet Right to Buy Promise, Warns NAO

The warnings are included in an NAO report prepared for the Public Accounts Committee (PAC). MPs on the committee are analysing what impact the Housing and Planning Bill will have and whether it will achieve value for money.

The bill, currently going through the House of Lords, plans to give 1.3m housing association tenants the right to buy their homes at discounted prices. The extension of the current scheme would be financed through the sale of high value council homes when they become vacant.

The Government has also vowed to replace each home sold by housing associations, as well as additional properties for those sold by councils, with at least two additional affordable homes for each one sold in London, where there is a chronic shortage of housing. Councils will have three years to replace homes sold to fund the scheme.

However, the NAO report warns MPs that the “pace of replacement will also need to accelerate to keep pace with the target in subsequent years”.

It states: “To meet the target of replacing the roughly 8,512 homes sold in 2014/15 by the end of 2017/18… would require quarterly housing starts to reach around 2,130, a fivefold increase on recent figures of approximately 420 per quarter.”

The NAO also criticises the Department for Communities and Local Government’s (DCLG) assessment of the impact of the policy. It claims the DCLG assessment, “when reviewed against good practice… has weaknesses”.

The NAO says that the DCLG’s assessment fails to give alternative options for achieving its aims, or a summary of other options considered at an earlier stage. It adds that while it identifies a number of groups that may be affected by the bill, “it does not seek to quantify the costs or benefits, and it omits some potential impacts”.

The NAO concludes: “Additionally, though dependent on certain assumptions, the impact assessment does not state those assumptions clearly, use evidence to justify them, or sensitivity analysis to consider the potential impact of uncertainties relating to them.”1

The Government has confirmed that secondary legislation will define what high value is when determining how much each council will pay to fund the sale of housing association homes.

The extension of the Right to Buy scheme to housing association tenants has been continuously criticised. Many believe that it will restrict the availability of affordable housing.

Also, it was recently claimed that many homes sold through the current Right to Buy scheme for council tenants are now being rented out by private landlords.


Many Homes Sold Through Right to Buy Now Owned by Private Landlords

The Communities & Local Government Committee has warned the Government that many homes sold through the current Right to Buy scheme have ended up being rented out through private landlords.

Many Homes Sold Through Right to Buy Now Owned by Private Landlords

Many Homes Sold Through Right to Buy Now Owned by Private Landlords

The committee revealed that landlords are letting 40% of ex-council homes sold through the controversial scheme at more expensive rent prices.

The warning arrives as the committee discussed the Government’s plans to extend the Right to Buy scheme to housing association tenants. The extension would be funded through forcing local authorities to sell off their most valuable assets.

The Government also expects housing associations to build one affordable home for every property sold.

The Chair of the Communities and Local Government Committee, Clive Betts MP, comments: “The fundamental success of this policy will depend not just on whether more tenants come to own their home, but on whether more homes are built.

“As a committee, we are concerned that there are a number of unresolved issues with the Government’s policy, which could have a detrimental effect on the provision of accessible and affordable housing, particularly affordable rented property.”

He continues: “The Government needs to set out in more details on how it will meet its target of at least one-for-one replacement of the sold homes, particularly given issues such as the availability of land, the capacity of the building industry and the uncertainty of income from council home sales.”1

The concerns were raised after the committee found that a large number of properties sold through the original scheme have quickly become private rental sector homes.

Its report states: “The committee believes the potential for selling social housing assets at a discount, only for them to become both more expensive and possibly lower quality housing in the private rented sector, is a significant concern. The committee recommends measures to restrict homes sold through the Right to Buy ending up in the private rented sector need to the explored.”1 


Council Tenants Lose Right to Live in Their Home for Life

Published On: December 11, 2015 at 1:52 pm


Categories: Property News

Tags: ,,,,

Council tenants will lose their right to live in their homes for life under plans to impose a five-year limit on new tenancies.

Council Tenants Lose Right to Live in Their Home for Life

Council Tenants Lose Right to Live in Their Home for Life

The proposal has been condemned by the Labour Party, which believes the move will break up communities. However, the Government has quietly tabled an amendment to the Housing and Planning Bill that sets a maximum of five years for new tenancies.

The new rule removes the standard of lifetime council tenancies. In some cases, tenants are even allowed to pass on the right to live in the property to their next of kin. Despite the new policy not applying to current tenancies, those that inherit a council house tenancy will be subject to the new system.

Explaining, Housing Minister Brandon Lewis states: “A secure tenant can currently live in a property for life. This amendment phases out lifetime tenancies.”1

David Cameron first proposed the move in 2010 when he argued that it could help increase social mobility.

He admitted that “not everyone will support this and there will be quite a big argument”. However, he said: “There is a question mark about whether, in future, we should be asking when you are given a council home, is it for a fixed period? Because maybe in five or ten years you will be doing a different job and be better paid and you won’t need that home, you will be able to go into the private sector.”1

The coalition government never enforced the plan, with the then housing minister, Grant Shapps, revealing plans to allow tenancy limits to be set in each local area.

The new legislation forces local authorities to offer all new tenants contracts of between two and five years. At the end of the fixed term, councils must conduct a review of the tenant’s circumstances and decide whether to grant a new tenancy, move the tenant to another more appropriate social rental property or end the tenancy.

If the council decides to terminate the tenancy, they must offer advice to support the tenant into homeownership or help them access other housing options, whichever is suitable.

Labour’s Shadow Cabinet Minister for Housing, John Healey, has criticised the plan, saying people will be “astonished that ministers are legislating to deny families a stable home”.

He continues: “Councils are already able to decide on the length of tenancy they want to offer according to local needs. Margaret Thatcher passed the law to give council tenants secure tenancies, which David Cameron is now tearing up. This generation of Tory ministers seem to have a vendetta against council tenants and council homes.”1 

A Department for Communities and Local Government spokesperson insists the changes will “improve local authorities’ abilities to provide social housing for those who need it most, as long as they need it”.

They add: “This is about ensuring we make the best use of our social housing and that tenancies change as needs change. We want to support households to make the transition into homeownership where they can.”1

It is believed that the Government changed the law as ministers feel that councils are not making effective use of their powers to offer fixed-term tenancies.

The law does not currently apply to housing association tenants.


Right to Buy for Housing Association Tenants Given the Go-Ahead

Right to Buy for Housing Association Tenants Given the Go-Ahead

Right to Buy for Housing Association Tenants Given the Go-Ahead

Around 1.3m housing association tenants will be given the right to buy their home from as early as next year, as the Government’s controversial scheme is given the go-ahead.

The Government has secured a deal with social landlords and the National Housing Federation (NHF).

Prime Minister David Cameron comments: “Some people said this would be impossible and that housing associations would never stand for it. But today we have secured a deal.”1 

When they give a Right to Buy discount, the housing association will be compensated by the Government.

Housing associations will then keep the sales money to help them fund new homes. They will have flexibility over the tenure of the new stock, such as shared ownership.

In some cases, the housing associations can choose not to sell a particular property, for example, if it is in a very rural area and could not be replaced or if it has been adapted for disabled tenants.

However, if this arose, the housing associations would offer tenants the chance to use their discount on another home from either their own or another association’s stock.



















113,000 Council Homes Sold Off Through Right to Buy, Warns Shelter

Published On: September 24, 2015 at 9:55 am


Categories: Landlord News

Tags: ,,,

113,000 Council Homes Sold Off Through Right to Buy, Warns Shelter

113,000 Council Homes Sold Off Through Right to Buy, Warns Shelter

Almost 113,000 council houses could be sold off through the Government’s Right to Buy scheme, which will force councils to put their most valuable properties on the market when they become vacant, warns Shelter.

The money raised from the sales will be used to fund discounts of up to £100,000 for housing association tenants who wish to buy their homes.

The housing charity says the scheme is “potentially devastating”1.

It states that the London Borough of Camden will be one of the worst affected areas, with over 11,700 homes facing a forced sale, equivalent to around 50% of the total council housing stock in the area.

Kensington and Chelsea could be forced to sell a huge 97% of its total council housing, or more than 6,600 homes, once they become vacant.

Shelter also believes that the loss of council homes will not only be experienced in London; Cambridge could lose 46% of its total, or over 3,200 homes, and York could see 1,400 homes sold, or a fifth of its total stock.

Chief Executive of Shelter, Campbell Robb, says: “At a time when millions of families are struggling to find somewhere affordable to live, plans to sell off large swathes of the few genuinely affordable homes we have left is only going to make things worse.

“More and more families with barely a hope of ever affording a home of their own and who no longer have the option of social housing, will be forced into unstable and expensive private renting.”1
















Former Energy Secretary Calls Right to Buy Extension ‘Mugabe Politics’

One of David Cameron’s former cabinet ministers has described the Right to Buy scheme extension as Robert Mugabe politics.

Ed Davey, an ex-Liberal Democrat MP who was Energy Secretary in the 2010 coalition cabinet, criticised the proposal, which will force housing associations to sell off homes.

Former Energy Secretary Calls Right to Buy Extension 'Mugabe Politics'

Former Energy Secretary Calls Right to Buy Extension ‘Mugabe Politics’

At the Lib Dem conference in Bournemouth, Davey said: “The Tory policy of selling housing associations is Mugabe. That’s not acceptable, it’s shameful.”1

Housing associations are private, not-for-profit landlords that manage social housing. The organisations house people off the social housing waiting list, but also let properties on the open market.

Opponents have said it is wrong to force the private organisations to sell their homes at a discount.

Last week, David Cameron wrongly said housing associations are “part of the public sector”1.

Housing associations borrow against the value of future homes to fund building projects, and they insist the extension will affect their ability to raise finances and build new properties. Some claim they will challenge the scheme in the courts if plans go ahead.

In April, the Institute for Fiscal Studies states that the extension will likely cause higher Government debt and result in fewer homes being built.

It said: “Given this uncertainty, and the coalition’s less-than-impressive record in delivering replacement social housing under the existing Right to Buy, there is a risk that these policies will lead to a further depletion of the social housing stock – something the proposal explicitly seeks to avoid.”1

Right to Buy was launched in the 1980s as a way of making homeownership more widely available.

However, many homes bought through the scheme have ended up being let back to tenants by the private landlords that purchased them.

Figures from August reveal that private landlords are now renting out almost 40% of properties sold through the scheme. Additionally, just one in ten homes sold under Right to Buy are actually being replaced, despite the Government vowing to replace the houses one-for-one.

The Government insists that the policy gives more people the opportunity to own their own homes.