Town Hall to buy back discounted homes at inflated prices
Properties were sold under former PM Margaret Thatcher’s flagship Right to Buy policy
25 October, 2019 — By Calum Fraser
Cllr Diarmaid Ward: ‘The fact that we are potentially buying back former right to buy council homes hammers home the point that this failed policy needs to be binned’
THE council is on the cusp of buying back homes at inflated prices that they were forced to sell under Margaret Thatcher’s flagship Right to Buy policy.
Islington’s housing chief Cllr Diarmaid Ward said Right to Buy was exacerbating the housing crisis, while also costing councils millions.
Cabinet councillors this week gave the green light to plans that will see them raise the £6million cap on borrowing to buy up to 50 new houses.
Some of these homes could be properties they were previously forced to sell to council tenants, at a discount of up to £110,000.
Cllr Ward said: “The fact that we are potentially buying back former right to buy council homes hammers home the point that this failed policy needs to be binned. It is decimating council housing stock and adding to the housing crisis.”
There are about 14,000 households on Islington’s waiting list. Many are in bed and breakfast accommodation or private homes that the council pays for. The council has estimated that each home will cost them about £435,000.
Cllr Ward said: “Under the current rules, local authorities only receive 75 per cent of the proceeds of any property that is sold under the right to buy.
“The rest goes to the government. But government red tape means that this receipt is only allowed to be used to pay for one third of the build costs of a new council home: we still need to find the other two thirds.”
A tenant can exercise their right to buy if they have been living as a secure tenant in a home for more than three years.
It must be their only home and the owner is locked into a five-year bind which means they would have to pay back the roughly £100,000 discount from the council if they sell in that time.
The paper passed on Thursday also gives the council permission to expand the area in which it buys homes to Greater London.
The Ministry of Housing, Communities and Local Government did not respond for a request to comment.