News & Insights
Re-invigorated “right to buy” provides further boost to housing market
A year after the Government re-invigorated Margaret Thatchers landmark Right to Buy scheme for council house tenants, it is now possible to assess its impact on the housing market in general.
The Right to Buy scheme allows eligible tenants up to £75,000 off the value of their home and up to £100,000 in the capital.
The latest figures show that 2,449 properties were sold in the first three months of this year alone. That equates to four times the number in the same period a year earlier; a figure that only relates to council housing stock sold to tenants. Certain housing association tenants, notably the ones whose homes were transferred from council housing, are also eligible.
At present, the scheme is little known and little publicised. But it provides an excellent way for people who consider themselves stuck as tenants in their council home to fulfil their aspirations and buy it.
As a nation, we need housing stock that is in the private market. Ambitious tenants who are confident of their income and their prospects will add to the overall number by bringing their homes into the market. Many will, in time, feel they can move on and buy another home.
Housing minister Mark Prisk has said the Right to Buy scheme was a further measure designed to enable people who work hard to get on in life. The proof that many people were taking the Government up on the scheme showed these ambitious people were “seizing the opportunity offered by Right to Buy.
There has been a phenomenal surge in Right to Buy sales, with those in Newcastle illustrating the situation perfectly. Ninety sales in the past 12 months in the city represented a 221% increase on the previous year.
Receipts from nearly 6,000 homes bought in this way have generated an income of some £368m in gross income. Another crucial point to make is that money from the receipts will be recycled back into affordable homes for rent.
Right to Buy is not right for everyone. The experience from the 1980s is that some people regretted having to live with a mortgage rather than a lower rent. Many others, of course, used it as a step up for their families. More than 30 years later, the financial benefits are still very tangible to millions of families.
The Government states that tenants can buy their council house if:
Its their only or main home
Its self-contained
Theyre a secure tenant
Up to three family members can make a joint application as long as theyve lived with the main householder for the past 12 months.
The Government wants to get more people into the housing market this way and are relaxing the criteria further. Where previously tenants needed to have been in a council home for five years, they can now apply to buy it after only three.
For further information: www.latimerhinks.co.uk or call 01325 341500.
