Is this the beginning of the end for Right to Buy in the UK?

[Sancho Panza]

Property Industry Eye 14/3/17

'The Welsh Government has introduced legislation to end the Right to Buy scheme in the country, triggering suggestions that England could follow suit as social rental housing continues its decline.

Scotland has already scrapped Right to Buy, but in England, Right to Buy is still due to be extended to tenants of housing associations.

Right to Buy ended in Scotland on 31 July 2016 following a consultation in 2012.

The Welsh Bill will mean that Right to Buy, and associated rights, for tenants of local authorities and registered social landlords will be abolished after a period of at least one year following Royal Assent of the legislation.

The delay between assent and implementation has led to suggestions that there could be a stampede among social tenants to take advantage of the existing Right to Buy.

Welsh Communities Secretary Carl Sargeant said the aim of the change is to protect and encourage social housing.

He said: “Our social housing is a valuable resource, but it is under considerable pressure. The size of the stock has declined significantly since 1980 when the Right to Buy was introduced. The number of sales is equivalent to 45% of the social housing stock in 1981. This has resulted in people in housing need, many of whom are vulnerable, waiting longer to access a home they can afford.

“The Bill supports the Welsh Government’s wider aims of a more prosperous and fairer Wales, helping to tackle poverty by protecting our stock of social housing from further reduction.

“I recognise the proposal affects existing tenants and we will ensure tenants are made aware of the effect of the Bill in good time before abolition takes place. The Bill will require the Welsh Government to publish information, which social landlords in turn must provide to every affected tenant, within two months of the Bill receiving Royal Assent.”

He said the Welsh Government has a target of creating 20,000 affordable homes.

Alongside social housing, this will include schemes such as Help to Buy and Rent to Own, he said.'

 

 

Have to say,right to buy has been a boon for many of my friends parents who bought in the 80's/90's,longer term though,it seems as if it's just been a transfer to private BTL LL's.

[Mrs Bear]

The house a daughter bought a few months ago (Oxford) had been lived in by the same family for 60 years - it was a probate sale,  in a road of largely ex LAs built in the 50s.  

But they had bought it from the council in 1971 (found out from a nose on the Land Reg).  So there must have been some sort of RTB well before Thatcher, which was news to me. 

[Snugglybear]

An article on the web says "The idea of a ‘Right to Buy’ for council house tenants originated after 1945 as part of the Conservative attempt to build a ‘property-owning democracy’; however, it was deemed inappropriate and of doubtful political value by party elites until Conservative councils enacted profitable local sales schemes during the late 1960s."

I'm presuming that Oxford Council was predominantly Conservative in the early 1970s.

[SarahBell]

11 minutes ago, Snugglybear said:

An article on the web says "The idea of a ‘Right to Buy’ for council house tenants originated after 1945 as part of the Conservative attempt to build a ‘property-owning democracy’; however, it was deemed inappropriate and of doubtful political value by party elites until Conservative councils enacted profitable local sales schemes during the late 1960s."

I'm presuming that Oxford Council was predominantly Conservative in the early 1970s.

oldham sold houses in the early 70s too.

and that is as red as red can be.

[Dorkins]

There's nothing wrong with having the right to buy your council house as long as it's priced at market price.

[Bhoy]

My sister lives in Denmark. There is a similar scheme where you can rent and then buy the property, however when you go to sell it, the sale price is pegged to an index other than the current average house price - i.e. if you bought it for £100,000 and property in that street has increased 50%, you would expect to sell it for £150,000.

However, because they were built as affordable housing, you can only sell it for the purchase price plus a special rate, which is low, so the actual sales price might be £105,000.

A much better scheme.

*I appreciate currency in DK is Krone and not £ and that I haven't done a great job of explaining the concept! 

 

[Mrs Bear]

11 hours ago, Snugglybear said:

An article on the web says "The idea of a ‘Right to Buy’ for council house tenants originated after 1945 as part of the Conservative attempt to build a ‘property-owning democracy’; however, it was deemed inappropriate and of doubtful political value by party elites until Conservative councils enacted profitable local sales schemes during the late 1960s."

I'm presuming that Oxford Council was predominantly Conservative in the early 1970s.

Don't know, but with so many students and academics I'd have suspected that the city would be more red than blue.  

Whichever, despite extremely dated decor it was obvious the moment you walked in that the house had been much loved and cared for.  

Edited March 15, 2017 by Mrs Bear

[MARTINX9]

The Tories won't get rid of it in England - they have ramped it up. The only way anyone gets a council House these days is either to be an anti social lowlife with multiple problems or have as many kids as you can. I remember that storyline in Call the midwife where the police officer and his midwife wife had to prove they were upstanding members of the community (married with one kid)  to get a council house in the 1960s - they wouldn't stand a a chance now.

No problem with right to buy - but the £105k discount is obscene.

[MattW]

15 hours ago, Mrs Bear said:

But they had bought it from the council in 1971 (found out from a nose on the Land Reg).  So there must have been some sort of RTB well before Thatcher, which was news to me. 

There was certainly some form of RTB prior to 1980. I recall a feature on The One Show a few years  back where this woman bougbt her house from the council in 1968 & was still living in it.

[Arpeggio]

22 hours ago, Snugglybear said:

An article on the web says "The idea of a ‘Right to Buy’ for council house tenants originated after 1945 as part of the Conservative attempt to build a ‘property-owning democracy’.

If Right To Buy never happened, we might have a situation in which people who live in council houses would be able to work hard, save up and buy a house for themselves on the open market that's has prices rises more closely linked to the real economy / wages / inflation.

 

10 hours ago, MARTINX9 said:

No problem with right to buy - but the £105k discount is obscene.

Insidiously this might be to ramp up HPI. If you want to get council housing away from competing against the private market quicker then making them cheaper for RTB gets the job done with political expedience. Selling a council house at ponzi market price that could only be affordable for a tax dodging elite, or the debt junkie would be too obvious, even for the Tories.

[OurDayWillCome]

My parents used RTB in the 80's and still live in the same house along with many other families around them. There has been one instance of a more recent tennant using RTB for BTL - legally because the timescales are way too short. You should only be allowed the RTB after a substantial number of years at the property and then there should be a 15 year sale/rent clause after that.

[PSP]

I hope so ! It is unfair on society as a whole !

[MattW]

22 hours ago, OurDayWillCome said:

My parents used RTB in the 80's and still live in the same house along with many other families around them.

Same here. My mum passed away 18 months ago but my dad still lives in the same house. They were council tenants for around 14 years before exercising their Right To Buy. They voted for Thatch too during the 80s. They did tell me that they assumed at the time that with every council house sale, a new replacement house was built by the council.

I wonder if a ban on RTB in England might result in more tenants and exercising their RTB before the deadline?

[OurDayWillCome]

24 minutes ago, MattW said:

They did tell me that they assumed at the time that with every council house sale, a new replacement house was built by the council.

I wonder if any money from the sales did go back into social housing - that's what should have happened.

[MattW]

4 minutes ago, OurDayWillCome said:

I wonder if any money from the sales did go back into social housing - that's what should have happened.

I don't think they were allowed to. To the best of my knowledge, proceeds from council house sales were put into maintaining the existing stock.

Furthermore, I think councils were disincentivised from building new council homes after the Right to Buy roll out in 1980. A bit odd as my council - Labour controlled Norwich City - built their last council house in 1990. Now to their credit they're building new homes since 2013 - albeit in small numbers.

I wonder where the £ came from if they couldn't use the revenue from house sales since 1980. However I think they did step in when a building company went down the pan at that time.

[council dweller]

I`m still thinking of buying. 

Don`t know if it would make sense or not, maybe I can just pay the rent until I`m 66 and then get it paid with benefits !?

[Sancho Panza]

1 hour ago, OurDayWillCome said:

I wonder if any money from the sales did go back into social housing - that's what should have happened.

Goes to the Treasury I believe.