REDDITCH Borough Council will need to pay nearly £9 million a year to the government to fund their flagship Right to Buy extension, according to new research by Shelter.
That’s the figure estimated by the housing charity as the policy, now being put through Parliament as part of the Conservative government’s Housing and Planning Bill, would force local authorities to sell off a proportion of their council houses on the open market once they become vacant.
The money would then be used to fund discounts of up to £100,000 for housing association tenants taking up the Right to Buy.
And the fear is that those homes, once sold, would not be replaced.
Shelter estimates this could force the sale of 23,500 council homes across the country in just one year – over the course of five years, this would be enough to house the entire population of Stoke-on-Trent.
Shelter’s analysis estimates the value of council homes in each area that are likely to become vacant and compares this to the £4.5 billion per year needed by the government to fund the extension of Right to Buy. This process also reveals the councils that will be hit hardest by the sell-off.
The problem is that the Housing Bill makes no commitment to replace the homes sold off like-for-like, meaning affordable homes in an area could be replaced by Starter Homes costing up to £250,000 – or £450,000 in London.
And with only one home replaced for every eight sold through the existing Right to Buy scheme, Shelter believe it is likely many won’t be replaced at all.
Campbell Robb, Shelter’s chief executive, said: “Whilst the small number of lucky winners from this policy will understandably be grateful for the chance to buy their Housing Association property, ultimately far more people will lose out and be left with no choice but expensive, unstable private renting.”