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

'We must understand the opportunities following the abolition of right to buy.'

30/01/2018


As the abolition of Right to Buy in Wales receives Royal Assent, CIH Cymru's policy expert Matt Kennedy says its legacy can help to guide future thinking.

The passage towards passing the Abolition of the Right to Buy and Associated Rights (Wales) Bill (to give it its full title) has seemed relatively straight forward in many respects.

Earlier this week the bill received Royal Assent meaning the implementation period has now started. In practice social landlords will need to begin the process of raising awareness among tenants who may have the right to buy that their time to exercise it will run out in a year's time.

Despite being a victory for protecting valuable levels of social housing stock, this measure comes at a time where the legacy of Right to Buy (RTB) in Wales will be a mixed bag. Between 1 April 1981 and 31 March 2016 around 136,000 local authority and 3,100 housing association homes were sold under the Right to Buy and Right to Acquire schemes(equivalent to 45% of the social housing stock in 1981). At its peak in 2003-04 almost 7,000 homes were lost from the stock in a single year. This peak coincided with the decision to reduce the overall discount from £24,000 to £16,000.

So despite boosting the amount of home owners in Wales, it’s been at the cost of valuable social housing stock and evidence put forward by the Welsh Government estimated that around 4,695 properties bought under the RTB have transferred into the private rented sector.

Extrapolating the sampled data from eight authorities to an all-Wales level, the research goes on to estimate that over the period from 2010-11 to 2014-15 an annual average of £4.4million was spent in extra housing benefit payments, a total of £21.9million over the five-year period. This research demonstrates that despite the policy intention of RTB being driven by the desire to increase the rates of home ownership, this has not always been the case.

More problematic still has been the issues around maintaining building standards in leaseholder arrangements where responsibility for costs haven’t been well-understood at the time of purchase leaving housing associations or local authorities having to pay for more substantial maintenance or upgrading work. Further to this, once properties passed into the private sector they no longer benefitted from the Welsh Housing Quality Standard programme of improvements.

What’s important now is that we learn the lessons from Right to Buy and understand what the opportunities are following its abolition. While it’s understandable for any government of any political colour to promote homeownership we need to get back to reality and tackle what is stopping people from meeting their own housing aspirations.

And while this should include promoting measures to enable affordable and sustainable home ownership it must also mean a fair and accessible rental market across all tenures. Continuing to ensure affordable housing remains just that, highlighting the impact of the LHA cap in the private rented sector and making the welfare system work for everyone must work in tandem with increasing the availability of and boosting the supply of social housing.

The Right to Buy has undoubtedly been good for many households who now find themselves as homeowners but its abolition points squarely at one thing – housing supply can’t accommodate this kind of initiative (anymore).

Matt Kennedy is policy and public affairs manager at CIH Cymru.


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