The UK Government is proposing changes to the Right to Buy (RTB) scheme intended to create a fairer and more sustainable system which retains the opportunity for social housing tenants to buy their homes while supporting councils to replace properties that are sold. Propertymark is supportive of the proposals, which include increasing the length of time someone needs to have been a public sector tenant, amending discount percentages, and allowing Councils to ask for repayment of discounts if the property is resold within ten years.

Why change is needed

The Right to Buy scheme has led to a significant reduction in the number of social homes, with an average net loss of 24,000 properties per year since 1991. Meanwhile, demand has spiralled, leaving nearly 1.3 million people on the social housing waiting list and over 117,000 households in temporary accommodation.

Homes are leaving the social sector far more quickly than they are being replaced, and the discounts currently offered can lead to properties being sold for less than the cost of construction, making the scheme financially unsustainable and deterring councils from investing in new builds. 

As a result, many lower-income households have been pushed into the private rental sector (PRS), driving up demand and rents. In our latest Housing Insight Survey, our members reported that there are seven applicants per available property on average. The cost of housing benefit has also risen due to people renting privately following the loss of social homes.
 

Increasing the minimum qualifying period

Currently, an individual must have a secure tenancy and have spent at least three years as a public sector tenant before they can access the RTB scheme.

We agree with the proposal to raise this qualification period to a minimum of 10 years to more effectively target the scheme at tenants who have lived in and paid rent for their home for many years. This will ensure the discount doesn’t exceed the amount collected in rents and exclude applicants who are looking to exploit the system by gaining a social housing tenancy and then buying it at a significant discount.
 

Homebuyers should only benefit once

Propertymark believes there should be a restriction on the number of times an individual can benefit from RTB, as the scheme is intended to provide a stepping stone to get tenants onto the housing ladder. Owning another property or using RTB again in the future would undermine the aims of the scheme.

Furthermore, we urge the UK Government to make other pathways to homeownership available to prospective homeowners who do not have access to the benefit of social housing, who are not eligible for the Right to Buy, or who have previously benefited from the scheme.

It is also right that eligibility for the scheme should be reserved for those who would otherwise not be able to save for a deposit, such as single-adult households. Other households, such as those who have large, combined incomes, have alternate opportunities to secure homeownership and should not be seeking to exploit this scheme.

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