Larger right-to-buy discounts risk depleting council housing stock
Many lay people may have assumed that all the Council houses which were likely to be sold had left the system some time in the 80s. This is not the case as this article profiles. I cant help but ponder this policy must exacerbate the problem of supply of rural social housing. The article which profiles this tells us:
In April 2012, the coalition government increased the maximum cash discount to £75,000 across England, rising to £100,000 in March 2013 for tenants in London.
Since its introduction in 1980, almost 2m councils houses have been lost under the right-to-buy. To counter claims that the policy is decimating social housing stock, the government introduced its one-for-one replacement principle that each social home sold should be replaced with a similar one.
According to the Department for Communities and Local Government, all additional homes sold as a result of the increased right-to-buy discounts will be replaced with a new affordable rented home.
But what does it really mean? Not only does this apply to homes additional to projected sales, but houses currently rented at cheaper, social rates (normally around 40-60% of market rate) can be replaced with homes let at 80% of market value under the government’s affordable rent model. There is also no commitment that homes will be replaced locally, nor are there specifications on size.
Councils, which became self-financing last year, can only use 30% of receipts towards building new properties and must spend receipts within three years.
The Local Government Association says that the government is putting councils in “an impossible situation” by dictating the discount they have to offer.