There have been repeated assertions that right to buy sales have failed to fund the equivalent number of replacement properties.
This case from the opponents of right to buy is flawed for three reasons.
First of all, they look at the figures for new council housing. But councils are allowed to fund new properties built by housing associations.
Secondly, the time lag is ignored. Of course finding sites, gaining planning consent, and building new homes takes time. The Government allows a deadline of three years between the receipts coming in and replacements being required. Thus the proceeds retained by councils in 2012-13 have to be used by the end of this financial year.
Thirdly, even if a local council does fails to ensure the replacement homes are built there is a safeguard. They have to hand over the money (plus interest) from the right to buy sales to central government. Then the Government – via Homes and Communities or the Greater London Authority – will fund the replacements.
Recently I researched which local authorities are on track to provide replacement homes and which ones are failing and thus are leaving central government to take on the challenge.
The immediate pressure is the looming deadline to provide replacements for the properties sold in 2012/13 – when the reinvigorated right to buy was launched with discounts of up to £75,000.
The exact terms of the “one for one” replacements varied slightly between local authorities – although here is a standard example.
There was some flexibility – for instance over the mix of one bedroom flats and three bedroom houses.
Social landlords can meet the costs of new homes by borrowing against the future rental income, contributing from their own resources – including land, and via grant funding from the Government. So that is a strong spur for councils to make use of surplus land often providing no value.
I am pleased to see that Hammersmith and Fulham Council is on track.
There have been nine sales in 2012/13 – and a total of 185 sales to date. There have been three replacements so far with funding for another 31 agreed and the Council tell me “a further 172 qualifying units are also at various points of the feasibility/design stages of development. The Council is not currently anticipating that any funds will need to be sent to central Government.”
Yet at a council meeting this week Labour councillors queued up to attack the right to buy – both for housing association tenants and, so far as one could tell, council tenants. For example Cllr Andrew Jones said: “Right to buy will take affordable housing for rent out of supply…the land economics of it are insane.” If he had bothered to check the facts with his own council officers he would know that the right to buy sales were successfully funding replacements on an equivalent level. One would have thought that was an achievement he would wish to trumpet. Not so. His hostility to home ownership is thus exposed as ideological. He wants as many people as possible to be tenants of the state whether they like it or not. His creed is municipal serfdom.
Cllrs Lisa Homan, Sharon Holder and Iain Cassidy are queued up to attack aspiration.
Cllr Homan is a home owner. Cllr Jones is a home owner. The Labour council leader Cllr Stephen Cowan owns a house worth around £1.5 million. From these residences they compose their speeches filled with bash the rich class war rhetoric and chat at their dinner parties about rising house prices. They think home ownership is good enough for them – but not for the council tenants and housing association tenants they represent.
Theses socialist councillors have climbed the ladder themselves and are now keen to kick it away for others.
Labour claimed their objection to right to buy was that even with the discounts most tenants could still not afford to buy. A touching concern – given that Labour nationally has attacked the increase in discounts as too generous. But if that concern was genuine they would have proceeded with the “right to buy part” planned by the previous Conservative council.
Labab Lubab, the Council’s Homebuy Manager tells me:
“As the Council is considering the Right to Buy Part scheme as part of the review of home ownership options for Council tenants, there have not been any sales through this scheme at present.”
So Labour’s claims to be supporters of home ownership in our borough have been tested – and have proved to be completely false.
There is too much social housing in Hammersmith and Fulham, full stop. In Broadway ward, 40% of residents are tenants of the council or a housing association (2011 census). In contrast less than 1% of residents are in shared equity schemes, and this figure has barely changed in a decade.
Labour have an obsession with social rental as their preferred tenure type, even though it is already grossly over-represented in the ecology of our streets and neighbourhoods. I would like to see far more shared equity in new build, and the right to convert from social rent to part-ownership, from which everyone would benefit in multiple ways.