Conservative 'Right to Buy'

This is not a new policy, or an exclusively Tory policy. The Right to Acquire Housing Association properties was introduced in the Housing Act 1996 and extended in Housing Act 2004.

I’m yet to be convinced this policy will be a significant change.

Re-anouncing old policies? Very Gordon Brown! 😀

And labour councils are certainly as bad as the Tories for flogging off social housing to their mates and donors encouraging private sector investment in the provision of housing

Its tragic really

binners – Member
Re-anouncing old policies? Very Gordon Brown!

And labour councils are certainly as bad as the Tories for flogging off social housing to their mates and donors encouraging private sector investment in the provision of housing

Its tragic reallyQuite, they’re not averse to a bit of nepotism in the process either, as the Prescots proved: http://news.bbc.co.uk/1/hi/uk/politics/64534.stm

No wonder no one by that name will get elected in Hull these days…

Four pages of opinion on this but I still can’t find out specifically what this ‘policy’ introduces that is different to the 2004 Housing Act. Can someone point to the detail of the proposed policy and explain exactly which change is more problematic than the status quo?

Interesting opinion from a housing expert on Five Live just now. He says that what Cameron is doing is fundamentally changing the entire business model for housing associations.

They work in a planned manner, over years, to build housing. Then they manage that stock. But by forcing them to sell their stock, that throws all the planning out of the window. As he pointed out, you can’t just tell them to build more houses, and expect them to do it. Its not that simple. They can’t just ay ‘oh…. ok then’ and just totter off and build a new housing estate. Where are they going to put it? Who’s going to build it? What infrastructure is it going to need? …. etc, etc….

Once again, a politician announcing a headline-grabbing policy, without giving a second thought as to how it might actually play out. Or maybe… cynically knowing exactly how it will play out….

I think we can all see (ninfan excepted, obviously) that what will end up happening is the housing association will be forced to sell their stock cheap (hopefully to grateful Tory voters), then they won’t build any more. What possible motivation is there for them to do so?

Previously, their purpose was to provide, and manage, social housing. Now they’re effectively being turned into property developers. Property developers with a difference. As property developers generally tend to make lots of money. The housing associations are being ordered to build houses that they then have to sell well below market rate! All to prop up a dodgy, entirely idealogical political position!

Would you bother?

No….. I doubt they will either.

Once again, a politician announcing a headline-grabbing policy, without giving a second thought as to how it might actually play out.

In this case we know exactly how it will play out because right to acquire HA properties at a discount has been on UK statute books since 1996!

Not at such a discount though. The right to acquire only came with a modest discount the right to buy is much larger.

Having said that I don’t see why there should be any discount as this is in effect a massive handout which benefits wider society not one jot.

In this case we know exactly how it will play out because right to acquire HA properties at a discount has been on UK statute books since 1996!

Not at such a discount though.

Can you state the discount increase, I can’t find the discount offered in the 2004 Housing Act.

Well a quick bit of googling on the gov.uk site states a limit of £16000 on the right to acquire whereas the right to buy can be over £100,000 in London and £78,000 elsewhere. It doesn’t alter the fact that any discount is a bad idea as it limits the ability to replace said stock.

it’s instructive to look what Labour run administrations actually do with the powers they have already got.

Aye its always instructive to be a hardened Tory and then cherry pick information that confirms your views and then present it in a one sided party political manner
I particularly liked the way you said up to 14 years when the average is 52.3 days

THANKS

a limit of £16000 on the right to acquire whereas the right to buy can be over £100,000 in London and £78,000 elsewhere.

Thanks that helps a lot with googling.

I think the 16k limit is for ‘social homebuy’ – a completely different scheme.

Looks to me as though “Right to Aquire” has regional limits, but a quick google suggests this discount can be as little as 9k but a 25pc discount is not unusual which in some places will be way over 100k.

EDIT: I apologize, as of 2010 it looks like you are 100pc right:
https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/66691/Right_to_Acquire_Discounts_by_location.pdf

Nope social home buy is different again

https://www.gov.uk/right-to-acquire-buying-housing-association-home/discounts

Well according to this site anyway.

Cross post, which now reads a bit harsher than is intended.

Once again, a politician announcing a headline-grabbing policy, without giving a second thought as to how it might actually play out. Or maybe… cynically knowing exactly how it will play out….

What it needs is a short, punchy name that everyone will recognise, I’m not sure ‘Right to buy for housing association tenants’ works, so how about ‘Landlord’s Charter’?

Legally it’ll be interesting as a lot of housing associations ‘bought’ the housing stock from the local authorities. It will have massive repercussions on centuries of property law if the government can force a private organisation to sell it’s assets at a below market rate.

…. and has already been pointed out, aren’t the Tories supposed to be absolutely dead against any state interference in the machinations of the market?

Well as someone in the Grauniad the other day said, they’re trying to privatise what they don’t even own. It really is the most crackpot, ill-thought through idea I’ve heard in a long time.

The HAs don’t “suffer” the discount it comes out of a government pot so there is no loss. On the face of it not that different to Freeholders being forced to sell to leaseholders, which they are under existing law.

But that’s at market rate isn’t it? Still seems wrong though.

If, as is planned, the discount is made up by government then so is the sale by a HA under the proposal.

The HAs don’t “suffer” the discount it comes out of a government pot so there is no loss.

Of course they suffer. They’re being forced to sell assets they’ve spent a long time planning, funding and building. They exist to provide affordable housing to tenants. Yet now the government comes along and tells them they have to sell off the stock that they’ve painstakingly built up over over years/decades which completely undermines their reason for existing. As binners says, why would they bother if they know the stock is going to end up in the hands of private owners, and in time probably private landlords?

Yet now the government comes along and tells them they have to sell off the stock that they’ve painstakingly built up over over years/decades which completely undermines their reason for existing

They have got money for the sale they can build more.

If, as is planned, the discount is made up by government then so is the sale by a HA under the proposal.

Often handy in sentences like this to remove ‘government’ and insert ‘taxpayers’…

They’re being forced to sell assets they’ve spent a long time planning, funding and building. They exist to provide affordable housing to tenants. Yet now the government comes along and tells them they have to sell off the stock that they’ve painstakingly built up over over years/decades which completely undermines their reason for existing. As binners says, why would they bother if they know the stock is going to end up in the hands of private owners, and in time probably private landlords?

Right to Acquire SA properties at a discount came in in 1996 and was extended in 2005. So housing associations have been coping with this situation for nearly 20 years, and they do still bother.

Which doesn’t make it a good policy, but let’s keep some perspective on the impact.

They have got money for the sale they can build more.

But why would they? Whats their motivation?

So as soon as they’ve built them, the government tell them to sell those too? Then they’re back to square one, and the whole process starts again?

Seriously… would you?

Housing associations are not-for-profit organisations. They were set up to provide social housing. They are now effectively being asked to become property developers instead. Thats a hell of a change of job description.

I’m going to go out on a limb here and assume that the type of person who works for an organisation providing social housing probably isn’t too keen on spending their days propping up Daves latest wheeze to manipulate the housing market for his own political ends. Not to mention seeing the houses they built ending up, somewhat inevitably, in the hands of profiteering private landlords

But why would they? Whats their motivation?

Yes, This is precisely the problem. A lot of housing associations have started to look seriously at expanding their housing stock by building new ones, but like all capital investment projects the financials will be worked out on a long term basis; if they are forced to sell those properties after 3 years the reasons for doing it may not stack up. Also housing associations have invested in renewables to get the feed in tariffs and renewable heat incentives – this is another source of income they would lose if they have to sell the property.

In order to run any business you need to have control over your assets and have the ability to sell them at a time of your choosing

They have got money for the sale they can build more.

So why not take that money, setup a house building government agency, build some houses and then sell them to first time buyers at affordable prices? Of course they won’t do that though, because that would be ‘big government’ interfering in the ‘free’ market. 🙄

The only rational explanation for this policy is for the current government
to exercise the right to buy on 9,10,11,12 Downing Street SW1A .
You get a discount after 5 years – and even more after 10…

Aye, I never noticed the Camerons being on the receiving end of the bedroom tax and having to move to somewhere smaller

Aye, I never noticed the Camerons being on the receiving end of the bedroom tax and having to move to somewhere smaller

I was going to reply to this with “That’s because he isn’t lucky enough to live in a state subsidized property.” but, on refection, he does. 😀

So why not take that money, setup a house building government agency, build some houses and then sell them to first time buyers at affordable prices? Of course they won’t do that though, because that would be ‘big government’ interfering in the ‘free’ market.

So what happens when these affordably priced houses are sold on for a profit as will undoubtably happen ?

The Government should be building affordable/social housing for rent.

This isn’t a Conservative v Labour issue as Labour did nothing about the situation during its 13 years in office, they sold more council houses than did the Tories (need to double check that but heard it on the TV)

So what happens when these affordably priced houses are sold on for a profit as will undoubtably happen ?

By ‘affordable’ I didn’t mean ‘massively discounted’.

The Government should be building affordable/social housing for rent.

I agree 100%. I was just pointing out though that if the aim is to build affordable housing and help first time buyers, they could achieve that directly by building the houses themselves at a fraction of the cost as opposed to forcing HAs to do it by proxy when they don’t want to.

Well as someone in the Grauniad the other day said, they’re trying to privatise what they don’t even own.

But didn’t the Tories successfully do that back in 1985 when they privatised the Trustees Savings Bank (TSB) despite it not being owned by the government?

I’m going to go out on a limb here and assume that the type of person who works for an organisation providing social housing probably isn’t too keen on spending their days propping up Daves latest wheeze to manipulate the housing market for his own political ends. Not to mention seeing the houses they built ending up, somewhat inevitably, in the hands of profiteering private landlords

why not? they would be supporting “profiteering landlords” from the Labour front bench who have bought housing association properties so as to act as a private landlord

seeing as labour have been stuffing the boards of housing association with their placemen it could even be a conspiracy of JHJ proportions 😉

they could achieve that directly by building the houses themselves at a fraction of the cost as opposed to forcing HAs to do it by proxy when they don’t want to.

Equally, HA’s could go out tomorrow and build new housing, selling half the houses they built on the open market to pay for the construction of the other (social) half

Ultimately the biggest brake on house building isn’t the government, but local authority planning and petty nimbyism tied in with house price fears and their chilling effect on the democratic system (after all, no councillor or MP is going to keep his seat by allowing a new housing estate to be built)

No thread on this evening’s telly debate?

Another previously lifetime Tory voter who really really wonders what on earth they’re playing at with the housing market at the moment… it’s economically illiterate and more than a little transparent! I really can’t bring myself to vote for them on this basis, it suggests they’ve not solved the crisis and have no effective ideas for doing so either.

Possibility a) the market is thoroughly overpriced and effectively bust as prices are so far beyond earnings but it’s the only way the electorate think they’re doing ok so the Tories are just trying to stave off the bust until after the election. If they don’t get back in, they blame the new government, if they do get back in they have 5 years (fixed term parliament) to get prices growing again.

Possibility b)
When they stress-tested the banks the other month, which included a 35% drop in house prices, the result showed another bust the impact of which would be even worse than the current situation as BoE can’t drop interest rates any lower or print any more QE to try and keep things moving.
It would ruin consumer confidence, ruin consumer spending, and hence business, ruin the ‘recovery’, all those people who think they’re going to sell their house for their pension suddenly find themselves 5 years away from retirement with half of what they thought they had, and expecting the taxpayer to bail them out. In all likelihood the emotional shock to a generation addicted to house price growth would mean people on the street and social unrest.

Possibility b is pessimistic I know but the Tories seem absolutely desperate to keep house prices going up so I do wonder quite what they’re trying to gain/avoid that’s leading to such blatant manipulation of the market

This was a very interesting program on R4 regarding right to buy.

http://www.bbc.co.uk/programmes/b04pc2zz

Enfield Council have created a scheme which enables them to circumvent the central government ‘Right to Buy’