Social housing in crisis as right-to-buy depletes stock

Lib Dems say tackling deficit is ‘political priority’, with only quarter of replacement homes being built

A flagship housing scheme which allows tenants to buy their council house at a discount is eroding Britain’s stock of affordable housing – with only one home being built for every four sold off.

An analysis of figures show that since right-to-buy was re-launched by the Government in 2012, more than 20,000 properties have been sold off, with discounts of up to 70 per cent on market value.

But over the same period, local councils have begun building less than 5,000 homes to replace those sold – despite a claim by the then Housing Minister, Grant Shapps, that “every additional home sold will be replaced by a new affordable home on a one-for-one basis”.

About 1.7 million people are believed to be waiting for social housing across England. Local councils and housing associations say the lack of new building is because the big discounts on sales mean they do not have the money to replace the sold-off homes like-for-like – let alone build more houses to meet rising demand.

They, along with the Liberal Democrats, have called for local authorities to have full control over right-to-buy, including the ability to suspend the scheme.

“The arrangements are poor value for the public purse and do not support councils to replace homes sold under the scheme like-for-like,” said a spokesman for the Local Government Association that represents local authorities.

“We are pressing the Government to allow local authorities flexibility to set the discount rate locally and receive the receipts from sales directly, rather than through a restrictive agreement which limits councils’ ability to invest in replacement housing.”

Russell Brand protests with residents of a housing estate in east London yesterday, who face rent rises after its sale to a US investment firm (Reuters)

The LGA added that research found that 80 per cent of responding councils felt that the current arrangements did not allow them to replace all sold homes.

Research by The Independent has also found that a large number of homes sold under right-to-buy are now being rented out to people claiming housing benefit.

In Haringey, in north London, for example, of 396 homes sold since 2012, 28 are being rented out to people on housing benefit, at a cost of £265,000 a year to the public purse. The Liberal Democrat President, Tim Farron, said: “We need to replace every single home that is sold off through right-to-buy. It is an economic priority and a social priority. It must be a political priority.”

But the Housing Minister, Brandon Lewis, said council house-building starts were now at a 23-year high.

“There is a time lag between the sale and building of the new house, but there is a very strong incentive for councils to get moving, as the receipts are returned to central government if they are not spent within three years,” he said.

“Labour councils are doing much of the hard work identifying need, freeing up land and getting planning consent,” said Shadow Communities minister Hilary Benn.