Results of research undertaken on behalf of the Local Government Association (LGA) suggest that 2/3 of local authorities will not be able to sustain funding to replace each home sold off under Right to Buy.
If sales remain consistent with 2017, when 12,224 homes were sold under the scheme, then by 2023, only 2,000 of these homes will be replaced, since the majority of the sales funds are returned to the Treasury, rather than being reinvested in housing for the communities in which the homes were sold. Furthermore, since 2012, councils have been left with less than a quarter of the funds necessary to replace homes like-for-like. It’s almost as if the scheme was designed to fail.
This comes against the backdrop of new affordable housing statistics which show that the number of government-funded social rented homes being built has fallen by almost 90% since 2010,
Martin Tett, Housing Spokesman for the LGA, said that without reform, “this vital stepping stone into home ownership is under threat”.
“Councils urgently need funding to support the replacement of homes sold off under the scheme, or there’s a real chance they could be all but eliminated”.
“Enabling all councils to borrow to build and to keep 100% of their Right to Buy receipts will be critical to delivering a renaissance in housebuilding by councils”
Meanwhile, figures from the housing and homelessness charity Shelter show that a total of 1.15 million households were on waiting lists last year, with only 290,000 homes made available, leaving a national shortfall of more than 800,000 homes.
A spokesperson for the MHCLG asserted that the government remained committed to helping people get a foot on the housing ladder through Right to Buy. They said, “we will be consulting local authorities in the coming months on ways to increase their flexibility to replace homes sold, and will announce further details in due course”.