Cllr John Moss is a councillor in Waltham Forest. He recently made FoIA requests of all London Councils* to see how many properties they have sold under Right to Buy, how much they sold them for and how many replacement homes they are planning building with the money.
It is three years since the rules changed and the new Right to Buy rules came into play. In that time, London Councils have sold almost 7,000 properties collecting almost three quarters of a billion pounds in sales income.
Of that,16 per cent (around £120 million) has been retained by Government, around £75 million of Housing Revenue Account debt has been repaid and Councils have retained a further £100 million for things other than housing. But £430 million has been retained by those Councils for them to build new homes.
Some are doing so. The figures provided show that £185 million has been committed and, matched with other funding, will deliver 5,850 new homes, but £245 million remains uncommitted. If that was matched with a similar proportion of external finance it could deliver around 9,000 further homes, meaning London would be replacing the homes sold at a rate of 2.2 new homes for every home sold.
The homes sold are occupied. Without the discount, the tenants might not buy and most probably would simply stay where they are. The discount means they can buy the home they live in and Councils get cash to build new, affordable homes. The policy really ought to be called “Sell-to-Build”!
Those new homes will be unoccupied homes, all will be affordable and available for people on waiting lists or trapped in unsuitable, temporary accommodation.
There are lots of other interesting things in the responses I got; Why, for example have five Councils, (Brent, Camden, Harrow, Kensington & Chelsea and Lambeth), not committed any of their Right to Buy receipts to building new homes?
There is a three year window for them to spend the money so all will now be losing the money from their earliest sales. Why have Hackney and Hounslow been able to retain 71 per cent and 77 per cent of the gross receipts for new building, but Hammersmith and Fulham and Croydon less than 40 per cent?
Why is it costing £360,000 for each replacement home in Sutton, but only £156,000 in Havering?
Brandon Lewis, the Housing Minister, says:
“This confirms that the 1:1 replacement promised under the reinvigorated right to buy scheme is working and can deliver, but Councils must get on with building the homes people need. If after three years (as the scheme allows) they fail to do that then we will intervene to ensure that new homes are delivered. We are determined to support those who wish to own their own home through Right to Buy and this excellent piece of research proves that the funds released are making a significant contribution to increasing Housing supply.”
My tables are available here. I encourage all Councillors to take a look and see how your Council is doing, then go and ask questions. The money is clearly there and will continue to flow for at least another five years from further sales as Right to Buy is no longer under the threat of a Labour Government. Londoners should be demanding to know why some of their Councils have been sitting on it doing nothing.
*Results are based on figures from 26 of London’s 33 councils, including the City Corporation. I received no responses from Ealing, Islington, Lewisham and Newham and Merton, Bexley and Bromley Councils have all transferred their stock to Housing Associations, who are exempt from FoIA requests. Richmond Council have also transferred their stock, but did supply figures for those receipts to which they were entitled.