Shared ownership Right to Buy likely to be applied to all rented homes funded under £12bn programme
Housing association homes built for rent under the government’s new Affordable Homes Programme look set to be automatically made available to tenants as shared ownership properties, Inside Housing can reveal.
Inside Housing understands that the government is working on plans to apply tenants’ right to shared ownership to all new rented homes built under the new £12bn, five-year programme announced in the Budget today.
Sector figures have been briefed by the Treasury that the government is looking to put conditions on funding from Homes England and the Greater London Authority that will ensure homes built for both affordable and social rent tenures will give tenants the option of shared ownership.
Sources close to the Treasury told Inside Housing that the government is contemplating the move. More details about the Affordable Homes Programme are expected in the coming weeks.
The revelations come after chancellor Rishi Sunak announced in his Budget today that the government would be committing £12bn to a five-year Affordable Homes Programme, which will start in 2021. The new programme marks a £3bn increase to the current £9bn programme, set to end in March next year.
At the Conservative Party conference in October, housing secretary Robert Jenrick announced that he would be looking to introduce a new shared ownership Right to Buy scheme that would give housing association tenants of newly built homes the option to buy their home under a ‘right to shared ownership’.
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However, housing association figures criticised the proposals, with some raising concerns about the impact it would have on landlords’ ability to borrow money for new development. The National Housing Federation said it could worsen the housing crisis.
Some believed that the government had dropped the policy, as it was not in the Conservatives’ general election manifesto, but the government confirmed last month that it was still on the table.
Commenting on the plans, Jon Lord, chief executive of Bolton at Home, said: “I think that [the plan] is very challenging for the North, if that was the case, because there are large parts of the housing market where there is a great need for affordable rented but not for shared ownership at this stage.”
One housing association source said: “I know some people will be negative about it but I would urge them to be more cautious.
“Lots of people do want to own their own home, and this gives them a clear route to doing that without having to move, which to some people is important.”
The sector was largely positive about the increased funding being given by the government through the Affordable Homes Programme. Mark Washer, chief executive of Sovereign, said that it marked a “better outcome than the sector was predicting”.
John Bruton, Stonewater finance director, said: “If we are to meet the full housing need across the country, it’s not going to go all the way there but we certainly welcome another £3bn.
“I think we are looking particularly at rented housing, that’s what we would particularly like to see, affordable and social.”
Sinéad Butters, chair of Placeshapers and chief executive of Aspire Housing, said: “Is £12bn enough if the current tenure split stays the same?
“It’s not enough if it doesn’t rebalance the tenures. However many millions, billions, it would not be enough if it didn’t rebalance the tenures.”
Tracy Harrison, chief executive of Northern Housing Consortium, said: “It has been huge, very, very different to any other Budget we have had in recent years.
“I’m really pleased about the Affordable Homes Programme but we will need to see how it will be allocated. It must remain open to the whole country.”
Mark Perry, chief executive at Vivid, added: “We’re pleased the Affordable Homes Programme will be extended so that 70,000 more homes can be built in the areas most in need.
“The housing crisis and its impact on people isn’t going away so this announcement is encouraging. But we all need to ensure the continuing lack of housing supply and affordability is addressed across all tenures.”
Jennifer Wong, a vice president at the ratings agency Moody’s, said the additional funding would be “credit positive” for housing associations.
More on the Budget 2020
Inside Housing is bringing you up-to-date news, analysis and comment from the first post-Brexit Budget.
Here are the details of all our coverage so far:
Shared ownership Right to Buy likely to be applied to all rented homes funded under £12bn programme The government is looking at allowing tenants renting homes built through the new Affordable Homes Programme the right to shared ownership of their homes
Fire safety costs ‘could still hit development pipelines’ despite £1bn fund Concerns remain in sector despite cladding removal fund
Budget 2020: an improvement on recent years but questions remain Jules Birch gives his verdict on the first post-Brexit Budget
Housing figures react to ‘positive’ Budget announcements for sector Reaction from key sector figures to the measures unveiled
The housing bits of Sunak’s speech in full Read the key passages from the chancellor’s speech to the House of Commons
PWLB rates for social housing cut to pre-hike levels The cost for councils of borrowing to fund social housing will fall
Budget 2020: the key housing measures at a glance An at-a-glance guide to the key Budget announcements for the sector
Chancellor announces additional £12bn for Affordable Homes Programme Rishi Sunak announces the largest affordable grant programme in years
£650m fund to tackle rough sleeping The chancellor promises to fund 6,000 new places for rough sleepers to live
£1bn Building Safety Fund to remove ‘all forms’ of cladding The government pledges money to make all buildings safer
Housing secretary to announce planning reforms Ministers will set plans to reform the planning system on Thursday
Pre-Budget:
What should the housing sector look out for in today’s Budget? Peter Apps runs through the issues the sector should be looking out for
The housing sector is right to feel anxious about tomorrow’s Budget The government has indicated that its main focus with regard to housing policy is homeownership. The sector should be nervous about what this means for its spending priorities, writes John Perry
What the sector wants from the chancellor James Wilmore sifts through the submissions from the sector’s biggest players to find out what they want from the Budget later today
Conservative MPs urge chancellor to use Budget to build more social housing A group of 27 Conservative MPs and the mayor of the West Midlands have written to chancellor Rishi Sunak ahead of the Budget statement to urge him to allocate more money to building social housing.
How this Budget will signal the government’s direction of travel on housing With the first post-Brexit Budget due, Kate Henderson assesses the issues on which the sector has been lobbying
