Sunday, May 31, 2015

But there’ll be a one-for-one replacement. Won’t there?

Ex-Whitehall chief criticises right-to-buy housing policy

Extending the right to buy to 1.3m HA tenants has been criticised by all and sundry - even Boris, who wants severe strings attached. HAs aren't happy, but the wheeze is that they will be compensated for the discounts they'd have to offer from money raised by forcing local authorities to sell off their most expensive housing. It sounds as if the office temp thunk this one up - "Whitehall sources say the Tories rushed out the announcement in the run-up to the election when they believed the ideas could be shelved or watered down in any coalition with the Liberal Democrats or other parties". So, are they stuck with it?

Posted by icarus @ 05:00 PM (2902 views)
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3 thoughts on “But there’ll be a one-for-one replacement. Won’t there?

  • Next shoe to fall, is a right to buy for private renters.

    It works particularly well if the discount is taken out of what the landlord would have paid in capital gains tax, with the landlord then getting a massive capital gains discount.

    We absolutely need a way for buy to bring properties into the market now stuck in capital gains limbo (sell them and pay massive capital gains taxes vs mortgage equity release to buy more houses).

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  • This is a terrible idea. As soon as they are sold, the banks get to capture even more of the nation’s rent. A housing unit goes from taking 80% market rent (which of course still includes a modest to enormous location premium) to taking 100% market rent. That money gets diverted from spending on goods and services, i.e. real wealth, to parasitic sponging… The person in a council flat has has a lot more disposable income that supports jobs and real economic activity compared to the poor sod renting the identical Right-To-BTL next door.
    To blunt the stupidity of this policy, how about
    1.No sale until a proper replacement has been completed. Replacement must be same size and within a mile.
    2.When it ends up as a BTL as most of these will, they have to offer the same terms and price as the Housing Association. Violation means compulsory purchase at whatever the discount % was and a big fine
    Chances? With any luck the Housing Associations will win in their court cases to protect their private property rights

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  • CGT is only going to be about 20% of the profit so won’t be not enough to fund a right to buy giveaway for private renters.
    Also the only reason the government entertains the idea of RTB discounts is because it’s not their money they’re giving away. The houses belonged to local government, but central government siphoned off the money.
    Selling council houses was a fairly easy asset strip sold to voters under the guise of increasing home ownership for hard working families or some other such bs

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