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The Chartered Institute of Housing is the independent voice for housing and the home of professional standards

The reinvigorated Right to Buy

16/03/2012


This week’s announcement on Right to Buy in England has stimulated lots of discussion and debate throughout the sector. Karen Armitage, chief executive of Stafford and Rural Homes and member of the CIH Governing Board provides her perspective in a personal capacity - as a housing professional - on the Right to Buy announcement.

CIH has been actively involved in the Right to Buy debate. We have been working with our members and the sector to gather their thoughts and experiences to directly inform our consultation response – we are delighted that we had nearly 50 contributions, which we submitted in February this year. Next week our policy team is meeting with government to discuss the next steps. Here you can find out more about our views on Right to Buy, read our consultation response and download briefing papers.


The reinvigorated right to buy

As a practitioner in the housing sector I write a lot about changes in housing policy and practice and try to reflect on the thinking behind these changes – and where we go from here.

I have tried very hard to understand what the thinking was behind the reinvigorated Right to Buy, and have taken part in some quite heated debates on LinkedIn relating to these changes.

It is, however, impossible to shore up the dichotomy of the Minister for Housing’s view: that social housing is a limited resource, lived in by many who don’t truly need it, and are therefore preventing those who do truly need it from accessing it; against selling it off at up to £75,000 discount, to those who can afford to mortgage and buy their houses.

There is, without doubt, a shortage of adequate housing for many people in this country. Housing providers have worked hard in the past to meet the demand for good quality housing for customers to live in. The first introduction of the right to buy decimated areas of housing stock, particularly good quality stock and stock in rural areas. According to the Minister, we have learnt from that lesson and the new reinvigorated RTB will provide a one-for-one replacement of houses that are sold. That can’t and won’t happen - at least not in the way most people understood the guarantee when it was announced.

The sold house is still on a plot that is not available. It is still lived in by the former tenant and is therefore not available. The receipt from the sale of the house, sold at an enormous discount to somebody who has lived there for many years at a subsidised rent (and so has already benefited from it) will be well below any replacement value. The asset is lost, and therefore is not available to shore up borrowing in the future, leaving many housing associations and councils short of headroom to borrow.

It has been shown that mortgage rescue has been significantly spent on buying back former right to buy houses. What an expensive way to replace sold off housing stock!

A recent announcement on the empty homes spend from government showed that “the number of long term empty homes had been reduced by 38,000, with councils receiving rewards of £64m” of extra help. That sounds a very expensive way of supplying access to homes?

Housing is currently often in the press. But if selling it off, bedroom taxing the poorest, cutting council tax benefit and reducing tenure length are the reasons for that I am very concerned about future housing supply in this country. I am even more concerned about the wellbeing of families unable to access reducing supplies of housing, or attempting to remain in a house and paying ‘taxes’ for spare bedrooms in three bedroomed houses because they have two same sex children under ten.

There is no doubt that people should be rewarded for working, but unemployment has increased month on month. The will to help sort this out is embraced by housing associations who deliver vast services to the customers and communities they serve. Homelessness has seen a 14% increase.

A person has a much lower chance of getting a secure paid job if they haven’t got a secure roof over their head. Let’s not always embrace every change but have the courage to stand up and say “actually, this would work better in this way”. Incentivise people to move out of social housing to purchase, if that is what they want. Don’t sell off the limited supply of houses for those who need them most.

You can get in touch with us here or visit us at www.cih.org


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