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Timeline: a short history of the Right to Buy for housing associations
The government is once again eyeing up extending the Right to Buy to housing association tenants, according to reports. Lucie Heath and Jack Simpson provide a short history of this policy idea
April 2015: David Cameron publishes his manifesto ahead of the 2015 general election. In it, he vows to extend the Right to Buy to housing associations tenants, while also promising to fund the replacement of properties sold under the extended Right to Buy “by requiring local authorities to manage their housing assets more efficiently”, for example by selling off their most expensive properties.
September 2015: The National Housing Federation (NHF) puts an offer to government proposing an extension of the Right to Buy on a voluntary basis. If accepted, the compromise would mean that ministers would not need to legislate to extend the policy. Housing associations are then given six working days to vote on the NHF’s plans. Just over half (55%) of the NHF’s 584 members vote in favour of the proposals, while 39% abstain and 6% oppose it.
October 2015: Mr Cameron announces that a “historic” agreement has been made with the NHF, which will see the Right to Buy extended to 1.3 million families.
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August 2018: Government launches Voluntary Right to Buy pilot in The Midlands, 1,195 days after Mr Cameron first promised a wide-scale pilot. The scheme – for which the Treasury set aside £200m – will see tenants apply for the opportunity to buy out their property and then be allocated discounts through a ballot process. Tenants are given one month to apply and set a deadline of spring 2020 to complete their purchase. Some homes will be excluded from being able to be sold, with these residents instead being given the opportunity to buy another housing association home through the ‘portability’ option.
September 2019: Speaking at the Conservative Party conference, new housing secretary Robert Jenrick announces plans to give housing association tenants the opportunity to buy their homes through shared ownership. Speaking at the conference, Mr Jenrick says that under the new scheme tenants would automatically have the right to buy as little as 10% of their home, and staircase up in 1% chunks. This would effectively offer up to 2.6 million households the option to buy. Social housing sector bodies warn that the plan would worsen the housing crisis and could impact the way lenders view the sector.
October 2019: Inside Housing reveals that only 10 homes have so far been sold through the Right to Buy pilot a year since its launch. A later report by Inside Housing discovers that only £10m of the allocated £200m has been spent on the Right to Buy pilot.
October 2019: The sector reacts critically to the shared ownership Right to Buy scheme as part of an Inside Housing analysis on the plan. Many raise concerns about the impact it will have on associations’ ability to borrow. Shared ownership is deemed not to be as attractive to lend against as social rent homes, and many lenders do not take on high proportions of shared ownership as security for deals.
November 2019: The Conservative Party votes for Boris Johnson as leader to stand in the next general election and the party publishes its manifesto. Within the manifesto, the government promises to maintain the Voluntary Right to Buy scheme agreed with housing associations and aims to extend the Voluntary Right to Buy pilot carried out in The Midlands to other areas. However, there is no mention of the shared ownership Right to Buy plan, raising questions about whether it will be brought in.
February 2020: After months of silence about the shared ownership Right to Buy scheme, Mr Jenrick confirms that it is still on the table, despite being omitted from the Conservative manifesto ahead of the December election. Sources close to the government tell Inside Housing that details of the scheme would be announced in due course.
March 2020: Inside Housing reveals that the shared ownership Right to Buy will likely be applied to all homes funded under the government’s new £12bn Affordable Homes Programme. The revelations come in the aftermath of chancellor Rishi Sunak’s first-ever budget, in which he confirms the funding package for the government’s flagship affordable housebuilding programme stretching from 2021 to 2026.
April 2020: Government agrees to extend the Voluntary Right to Buy pilot past the initially slated spring 2020 deadline, with tenants given until the end of the year to complete deals. However, no reason is given for the extension despite reports of lower uptake than expected, with issues around portability.
September 2021: A government-commissioned report looking into the Voluntary Right to Buy reveals that a nationwide scheme would potentially cost the government £14bn over 10 years. The report also reveals that 1,892 were sold or were close to selling through the pilot. A total of 44 associations sell homes through the scheme. However, a number of issues are raised, including around portability, with only 12% of tenants being offered the opportunity for portability, compared to the 69% who could buy their own home. This was largely down to difficulties in finding other stock that could be offered. The report also suggested that it would be “challenging” for the scheme to hit its one-for-one replacement target for homes sold, saying that the replacement homes “will be on average smaller, at higher rents and include more homes for shared ownership and fewer for rent”.
May 2022: The Telegraph reports that Number 10 is weighing up a plan to extend the Right to Buy to all housing association tenants. As part of the plan, the government is looking at allowing banks to consider housing benefit as income when residents are seeking mortgages.
