The government’s extension of the Right to Buy policy will cost Tower Hamlets over £20 million a year, new research has revealed.
The policy, part of the Conservative Government’s Housing and Planning Bill, which is in the final stages of going through Parliament, would require local authorities to sell off their most valuable council houses on the open market.
Money raised from selling the council houses would then be used to fund discounts for housing association tenants taking up the Right to Buy.
Research published by the housing charity Shelter estimates that Tower Hamlets Council would have to sell off £21 million worth of council homes per year to reach the government’s estimated cost of the Right to Buy policy.
As part of its 2015 general election manifesto, the Conservative Party committed to extending the Right to Buy to tenants in Housing Associations, “putting home ownership within the reach of 1.3 million more families”.
But the policy has become controversial, with many local authorities concerned that they will bear the brunt of the cost.
Local housing campaigner Glyn Robbins said: “Like the rest of the government’s Housing Bill, the extension of the Right to Buy will make the housing crisis worse. Nowhere more so than the East End.
“It is a scandal that public assets – in the form of empty council homes – might be sold off to pay for Right to Buy discounts at a time when there are thousands on housing waiting lists and front line housing services are being cut.”
This week, housing minister Brandon Lewis said that the government will make no further concessions to the Housing Bill, which has been passed back and forth between the House of Commons and Lords, who are opposed to local authorities being forced to sell off their most valuable assets to fund the Right to Buy extension.
Campbell Robb, Shelter’s Chief Executive, said: “With millions of families struggling to find a home they can afford, forcing councils to sell-off huge swathes of the few genuinely affordable homes they have left is reckless.
“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.
“The government is out of touch on this issue, and running out of time to help the millions of ordinary people in London crying out for a home that they can actually afford.”