Posts with tag: right-to-buy scheme

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 


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

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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
















Third of Councils Selling Homes Under Right to Buy Haven’t Replaced Properties

Published On: September 21, 2015 at 6:00 pm


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A third of councils that have sold homes through the Right to Buy scheme have not replaced a single property, according to new figures.

Of the 166 councils in England to use the initiative, just two have replaced every home sold since 2012.

The Department for Communities and Local Government insists: “If councils do not deliver one-for-one replacements the Government will.”1

1 Shaw, V. (2015) No title, Metro, 21 September, p.32

Third of Homes Sold Through Right to Buy in London

Published On: September 18, 2015 at 4:53 pm


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Between April and June, 2,779 homes were sold by councils in England through the Right to Buy scheme and 307 replacements were started or bought.

The number of properties purchased through the scheme, which allows council tenants to buy their homes at a discount on the market value, was lower than the previous quarter’s figure, 3,321.

The replacement number also dropped, less than half the 710 starts and purchases in the last quarter of 2014-15.

Third of Homes Sold Through Right to Buy in London

Third of Homes Sold Through Right to Buy in London

A third of the homes sold were in London, where tenants can receive discounts of up to £103,900. Councils in the capital sold 962 properties and started or bought just 24.

Recently, it was revealed that some properties have been sold at up to 70% less than the market value, due to out-of-date valuations. Read more here: /council-homes-sold-at-70-discount/

Since Right to Buy was introduced by Margaret Thatcher in the early 1980s, over 2m homes have been sold by councils, many in the early days of the scheme. However, an increase in the available discounts in 2012 caused more sales.

The Chartered Institute of Housing reports that since April 2012, 32,288 properties have been sold, while just 3,644 have been started or bought to replace them.

Deputy Chief Executive at the Chartered Institute of Housing, Gavin Smart, says: “We understand the Government’s aim to encourage people to become homeowners, but we’re very concerned about the loss of social rented homes at a time when more and more people are in need of affordable housing.

“It’s always been clear that there would be a lag between homes being sold and homes built to replace them, but more than three years since Right to Buy discounts were increased, there is mounting evidence that one-for-one replacement is nowhere near being achieved.”

The Conservative’s general election manifesto proposed an extension of Right to Buy to 1.3m housing association tenants, leading to warnings that high levels of social housing stock could be sold and not replaced.

Smart adds: “An alternative option for the new Right to Buy would be giving tenants portable discounts they could use to buy properties of their own choosing, so that social rented housing could be kept and used to help people unable to afford to buy their own homes.”1


40% of Homes Sold Under Right to Buy are Being Sublet

Published On: August 14, 2015 at 4:01 pm


Categories: Landlord News

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Around 40% of ex-council homes sold under the Government’s Right to Buy scheme are now being let out on the expensive private rental market, causing a new generation of landlords.

In the first national study of its kind, Inside Housing magazine revealed the shocking statistics.

The Government is planning an extension to the Right to Buy scheme, to include a further 1.3m housing association tenants. Tenants are offered discounts of over £100,000 per property in London and £70,000 elsewhere in the country.

Under the Freedom of Information Act 2000, 91 councils in England released data revealing that 37.6% of flats sold to tenants under the policy are being sublet at up to seven times the average social rent.

Campaigners have called Right to Buy “a perverse subsidy” that harms the poorest in society.

A Labour leadership candidate, Andy Burnham, says the scheme is a “disaster”.

The councils announced that they have sold 127,763 leasehold properties, mostly flats and maisonettes, but 47,994 leaseholders now live at another address, suggesting that these homes are being sublet.

Over half of the former council flats in six local authority areas are now being let privately. The highest amount, 70%, is in Milton Keynes. Stevenage, Corby and Blackpool all sold more than 60% of their stock to people who are now subletting their home.

Burnham comments: “These figures show the dramatic impact of Right to Buy on social housing stock. Social house building has effectively stopped in most of England. It is a disaster for our country, leaves families without a secure home and drives up the housing benefit bill.

“I’ve put house building at the centre of my leadership campaign. For too many people across the country today, the light of hope for homeownership has gone out.

“The Government will make this situation even worse with its plans to sell off housing association properties through Right to Buy, without any credible plans to replace them.”

He adds that under his leadership, Labour would pledge a legally binding guarantee that if a council house or housing association property is sold under Right to Buy, at least one new similar home of a similar standard and rent must be built “within walking distance.”1

Average ex-council properties now available for private rent include a four double-bedroom apartment in Archway, North London for around £3,200 per month, a two-bedroom flat in Bermondsey, South East London, for £1,700 a month and a three-bedroom maisonette in the same area for £2,400 per month.

The cheapest rent charged by a registered social landlord in London is an average of £450 per month in Lewisham, South East London and up to £559 a month in Newham, East London, according to the Greater London Authority (GLA).

Housing estates are being transformed from homeowners and council tenants to professional sharers and students. And this is not just happening in the capital.

Nick Atkin, Chief Executive of Halton Housing Trust, which owns 6,400 homes in Cheshire after a transfer from the council, says that many of these are subject to Right to Buy.

He explains: “One in four sales is made to someone who is in receipt of housing benefit, so they are often not the person buying the home. It can be friends and family, but it is also companies who offer to purchase the home on their behalf.”1

Right to Buy was first introduced by Margaret Thatcher in 1980 and picked up again by David Cameron. The scheme gives council tenants the legal right to buy the home they live in. Since the discounts were increased in 2012, almost 30,000 homes have been sold under the policy, but the supply of affordable homes has fallen sharply over the same period.

After a steady rise in the supply of affordable housing from 37,470 a year in 2004 to 60,480 in 2010, a dramatic drop caused the availability of just 42,710 affordable homes last year.

Cabinet Member for Housing in Camden – where 36% of 8,922 leasehold properties are sublet – Pat Callaghan, notes: “Over the years, I have seen many of our estates become virtual honeypots for estate agents and landlords.”1

Director of tenant group Generation Rent, Betsy Dillner, claims: “Right to Buy is a perverse subsidy that worsens the overall situation of the poorest in society. Many of these properties are home to tenants who would qualify for social housing but pay vastly higher market rents that have to be covered by housing benefit, costing us all.

“If the Government really wants to promote the dream of homeownership, they know very well that investing in the expansion of social housing would prevent prices running away from millions of aspiring homeowners. Instead, we see them again pursuing the dangerous policies for the benefit of a few.”1 

Housing Minister, Brandon Lewis, says: “More council housing has been built since 2010 than in the previous 13 years. However, it is important that councils make the best use of their assets and manage their housing stock as efficiently as possible.

“So it is right that as high value council homes become empty, they should be sold to fund new affordable house building in the same area.

“Our proposals will do that and more, extending Right to Buy level discounts to over a million housing association tenants, with the homes sold replaced with new affordable homes.”1