Campaigners have called for reforms to the right-to-buy scheme after figures showed the number of homes sold by councils was up by almost a third in the second quarter of the year, compared with the same period in 2013, as the housing market recovery and discounts for buyers fuelled sales.
Official figures showed that in England 2,845 council-owned properties were sold to tenants between April and June, a 31% increase on the same period last year. Local authorities in London accounted for 33% of sales – the highest percentage since the quarterly statistics became available in 2006-07.
Over the same period, the Department for Communities and Local Government said 675 new dwellings were started or acquired by councils using right-to-buy funds, more than 10 times the figure in the same quarter of the previous year.
Right-to-buy was a flagship policy of the Conservative prime minister, Margaret Thatcher, who launched it in 1980 to allow social tenants to own their own homes. In the first three decades about 2m council properties were sold, but during the financial crisis the figure fell to less than 2,500 a year.
In 2012 the government “reinvigorated” the scheme, offering tenants discounts of up to £75,000. The report from DCLG said this was one of a number of possible drivers behind the recent increase in sales.
“The increase in right-to-buy sales since 2011-12 may, in part, be explained by the increased discounts available to tenants from 1 April 2012, the reducing of any effect of the financial crisis and the increased marketing surrounding the changes,” it said.
“In addition to this, in March 2013 the government further increased the maximum discount available for tenants living in London boroughs to £100,000.”
Councils received approximately £211m from right-to-buy sales, an average of £74,000 for each property sold, compared to £60,000 in 2013. They have three years to use the money they receive to fund replacement homes.
The maximum discounts available to tenants have just increased, to £77,000 outside London, and £102,700 in the capital and will be increased annually by the consumer prices index level of inflation.
The housing minister, Brandon Lewis, said the figures showed hard-working tenants were benefiting from government assistance.
But Darren Johnson, Green party member of the London Assembly, said right-to-buy was “a disaster” for London, where 948 council homes were sold to tenants over the quarter.
He said: “A lot of council homes sold today will be in the hands of private landlords tomorrow. Fewer low-rent homes will drive more low paid people out of inner London. The mayor should lobby for it to be scrapped and for councils to be allowed to borrow to invest in building many more.”
Separate figures for housebuilding show that in London 1,150 homes were started by housing associations and councils during the quarter, while 1,420 were completed. These figures were up by 5% on the same period of the previous year.
Across England, housing associations and councils started building 6,350 new homes and completed 6,180.
Catherine Ryder, head of policy at the National Housing Federation, which represents housing associations across England, said: “We support measures that help people buy their home but not at the expense of affordable housing for those in need and languishing on waiting lists.
“As these figures show, the discounts on offer now are very high, over £100,000 in London, meaning homes are sold at a price that makes replacing them very difficult. Right-to-buy needs to be urgently reformed to make sure every home sold is replaced by a new affordable home, otherwise the consequences for the next generation could be severe.”
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