Hunters founder and new Conservative MP Kevin Hollinrake says he supports the Tory policy of extending Right To Buy to housing associaton properties despite widespread criticism of the initiative within the agency and property communities.
Since being introduced for council flats and houses in 1980, almost 1.9m council properties have been sold through Right to Buy in England alone, and the total social housing stock has fallen by 26 per since the first full year the policy came into effect, according to the Institute for Fiscal Studies.
During the recent election campaign, the Conservatives pledged to extend the policy to some housing association properties too.
However, Hollinrake - newly-elected as MP for Thirsk and Malton - has told the Yorkshire Post that he backs the proposal to give housing association tenants RTB discounts of 35 per cent on a house and 50 per cent on a flat after three years of renting.
“The problem last time, when local authority tenants were given the right to buy, was that no money was set aside to replace the houses that were sold. The principle was good but not the practice” he says.
“Now there will be a statutory obligation to replace every property that is sold with another affordable home. I don’t see a problem with that and I think it will encourage housing associations to be proactive. Rather than just acting as landlords and collecting rent, they will have to build and that will be good for people on housing waiting lists” he claims.
There is already some speculation that the initiative may not see the light of day. The well-connected Sunday Times economics editor, David Smith, has described the RTB policy as one “which nobody much liked the sound of” and says it may be “kicked into the long grass.”
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Here is the flaw Kevin; flogging anything off at 35% discount will buy you a friend, you'll be happy, the purchaser will be happy, but the big unsaid here is that the Right to buy properties you are wanting to flog off are not yours to sell. The councils and housing associations doing the flogging on are effectively agents of the freeholder, in this case they are seeking to sell properties that belong to Great Britain. You are effectively giving a leg up to a minority very much to the detriment of those already house blocked out of accommodation let alone the opportunity of snapping up a bargain.
By my estimation £1.26 billion is not collected each year from landlords because HMRC has neither the wit , will or resources to collect it. Instead of supporting short term popular fixes which will exacerbate social discord {benefiting a few to the detriment of many], how about you gets to grips with the whole picture, apply your fiduciary obligation to do best by the client to your role in government and question what is actually going on
Reduce the social housing stock even more? Fabulous idea.
A shameless election bribe that was routinely dismissed as ludicrous by nearly everyone outside the little Tory HQ bubble. And now we have Mr Hollinrake endorsing it, I'm sure against his better judgement. At least I hope he doesn't think it's the right solution, otherwise I'm afraid he's in the wrong profession. Maybe he should become a full-time MP.
Right to Buy being extended to housing associations is a disastrous policy that will benefit a small number of people to the detriment of many others. It's a giveaway that does nothing to solve the housing shortage we currently have, it merely reduces available stock further. It's utterly brainless. I'm not totally sure it's legal either - I'm sure the housing associations (who are supposed to be not-for-profit organisations helping out those most vulnerable in society) will be too happy about their properties being sold off by the government.
And where have most of the Right to Buy properties since Thatcher ended up? That's right, in the hands of landlords with large portfolios who subsequently charge extortionate rents on the properties they snap up. The whole idea of a property owning democracy is ludicrous, because this does the opposite of that - it further reduces supply.
Is anyone actually in favour of this (Conservative MPs excepted, they have to tow the party line)? The guy from the Sunday Times pretty much hits the nail on the head. An unpopular policy that will never see the light of day. And we should all rejoice at that.
People in social housing being given the chance to own their own property? No, never, can't be allowed. Evil Tories!
Right to Buy is a fantastic idea in principle. As long as the stock is replenished, as Hollinrake says it will be, what's the problem?
I'd be very surprised if this ever came to a fruition. It was an election sweetener - that's the way I saw it.
I don't think many people in the industry are taking it seriously. If the government is sensible, they'll shy away from a policy that received such a negative press (from the property industry too, I should add). Any attempt to introduce it would be more trouble than it's worth.
The idea in principle is fine. But only when you replace the stock you sell, which we completely failed to do last time. I can't see why this time would be any different.
We're still feeling the effects of the original Right to Buy scheme implemented by Thatcher, doing it again is not the answer. The government and Mr Lewis - he knows the industry and I'm sure realises the potential toxicity of this initiative - would be better off focusing on long-term solutions rather than short-term fixes.
@Robert May - some great points you make. The government are failing to see the wider picture, they're just looking for short-term fixes and sweeteners.
Anyone with an ounce of sense knows this policy is totally unworkable. Just look at the panning it got when it was announced - as I said earlier, I've still yet to meet anyone who thinks it's a good idea. Even the people who it would directly benefit - i.e. the people who would be able to buy their housing association homes - are against it on the grounds of it taking away housing supply from the next lot of people who need it most. Dead in the water policy, won't ever be implemented. This is just Mr Hollinrake paying lip service to his Tory masters, nothing more.
Spot on, Robert May. Benefiting a few to the detriment of many - that should be this policy's slogan. It will do nothing good for the housing market. It attracted plenty of criticism when it was announced because people saw it for what it was - an election bribe. They never had any intention of actually pushing it through.
There are other issues in the industry that are far more pressing. The government would be well advised to focus on them rather than well-intentioned but ultimately hollow schemes like RTB.
@Kelly, on the face of it the right to own a property is great for the people with the right to buy. The whole point of social housing is to house those folk who couldn't buy even given the option. Removing stock to benefit fortunate social tenants is great but it simply takes the resource away from others.
There are working people excluded from social housing because of income, how is that sub set of the economy supposed to feel; excluded from unassisted purchase, excluded from assisted purchase and so trapped in rented accommodation?
Our village is about to get some properties which could end up in such a scheme ; 60 properties for 60 families. In terms of our village with 3 primary schools all with full rolls it doesn’t take a genius to work out only a micro percentage of the village offspring will get to stay in the village and only a fraction will be given to chance to buy a property subsidised by their less fortunate classmates and their parents.
You asked what the problem is; no-one has thought the whole thing through!
I'm in agreement with most of the commenters here. It's a bad policy that will never see the light of day because there's just too much opposition against it. In theory, it's pretty sound, but only if the stock is replaced. As we know, that hasn't happened.
As others have pointed out, I'm also unsure about the legality of it all. Housing associations own the properties in question - can the government merely sell this off without consulting with them first?
Anyway, it's very unlikely to happen. There are other things - building on brownfield sites, bringing empty homes into use, carrying out Build to Rent schemes and continuing with shared ownership and Help to Buy - that will do much more to bring supply and demand closer together.
How much do you understand about who is likely to benefit from those schemes Karl? The investment yields of PRS are about 5-6%, on social housing as much as 10%. With the BOE base rate on the floor property yields with consistent population demand and immigration pressures means solid long term returns. Add to that the over 55 pension pots that have just been released and you have all the ingredients of a changed forever European style society of owners and renters.
First time buyers aren’t getting a sniff at starter homes, those that hand out mortgages have investment divisions competing to get their hands on the same properties. An institutional buyer given to opportunity to buy in bulk, off plan? It is just making things worse.
I might be more than a bit outspoken but only when housing, ownership and rentals becomes an apolitical department, safely protected from vested interests at both ends of the spectrum will there be any chance of a fair and equitable society that rewards the positive things in our society and protects the less fortunate.
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