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Right to Buy consultation launched
The government has launched a consultation on changes to the Right to Buy scheme.
Potential reforms include extending the length of time someone has to be a tenant before they can buy their council home.
At the moment, there is a three-year minimum tenancy period to be eligible to apply under the scheme.
Labour is considering preventing tenants from buying newly built social homes for a given period, and targets to replace all future sales on a one-for-one basis with a social home.
It confirmed that it will not be extending Right to Buy to housing associations because of the cost to the taxpayer and the likely reduction in social housing stock.
It is also proposing to increase the period in which councils can ask for repayment of all or part of the discount received when a property is sold from five years up to 10, as well as making changes to the minimum and maximum discounts that will apply to both houses and flats.
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Deputy prime minister Angela Rayner said the proposals are aimed at increasing councils’ housing stock amid an unprecedented pressure for homes.
She said the proposals will ensure the scheme is fairer and more sustainable, and will still allow council tenants to own their own homes while supporting local authorities.
The government believes the proposed reforms will also make the scheme better value for taxpayers.
The Right to Buy scheme was introduced in 1980 by then-prime minister Margaret Thatcher and it enables council tenants to buy their council home at a discount.
The size of the discounts was increased in 2012 under a relaunch of the scheme to a maximum of £87,200 across England and £116,200 in London.
Councils previously had to give a proportion of the receipt from any sale to the Treasury, typically between 20% and 25%.
But in March 2023, the Conservative government informed local authorities that they would be allowed to keep all Right to Buy receipts for 2022-23 and 2023-24, in an attempt to boost housebuilding.
However, it ended the two-year policy in March at a time of significant financial hardship for councils, with several effectively declaring bankruptcy in the past five years.
The maximum cash discount is currently £102,400 across England, except in London boroughs where it is £136,400.
This consultation comes after the recent Budget, which saw the government reduce the maximum Right to Buy discounts and allow councils to retain all of the receipts from sales.
Previously councils had to give a share of sales to the Treasury, totalling around £183m every year.
Ms Rayner said: “For millions of people in the position I was once in, that first step into the secure social housing that changed my life has become a distant dream.
“Too many social homes have been sold off before they can be replaced, which has directly contributed to the worst housing crisis in living memory.
“We cannot fix the crisis without addressing this issue – it’s like trying to fill a bath when the plug’s not in. A fairer Right to Buy will help councils protect and increase their housing stock, while also keeping the pathway to homeownership there for those who otherwise might not have the opportunity to get on the housing ladder.”
The consultation will be open for eight weeks.
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