If you were around when Margaret Thatcher was elected into power, you’ll remember her allowing council tenants to purchase their council properties in the 80’s. I personally remember parents of friends having taken advantage of the Right to Buy scheme, excited they were finally on the property ladder. However, from the lack of social housing now in the UK and current owners struggling financially, was the Right-to-Buy scheme really the best way forward?
Families were stuck with bills for ‘major works’ as owners of their council house, and the new Right-to-Buy owners were expected to make a contribution to the freehold cost which was sometimes thousands of pounds. Every ex-council flat will certainly be leasehold meaning the new owner will be responsible for the annual service charge, ground rent, and, as mentioned, a share of any major works.
For anyone who’s lived in a council flat, you will know that councils are notoriously difficult to deal with, so imagine the hardship you’ll have when the council are your freeholders.
A quote from the Evening Standard says;
“With councils being increasingly cash-strapped yet having often self-imposed ‘decent living’ targets to hit, leaseholders can be seen as convenient cash cows to be milked whenever the local authority’s coffers run low. In extreme cases you could be one of, say, four leaseholders in a block of 20 units, with the other sixteen being occupied by council tenants.
“In such a scenario if the block’s roof, lift or brickwork needs major works, involving months of scaffolding and workmen, it isn’t the sixteen tenants who’ll be billed; the costs will instead be largely divided between the four leaseholders, which could be financially devastating.”
And it’s not just the extra charges imposed on new leaseholders. The Right-to-Buy scheme slowly saw the supply of social housing diminish so it’s no surprise that housing charity Shelter is against the idea of bringing the scheme back.
CEO of Shelter, Polly Neate, said:
“The hare-brained idea of extending Right-to-Buy to housing associations is the opposite of what the country needs. There could not be a worse time to sell off what remains of our last truly affordable social homes.
“The living cost crisis means more people are on the brink of homelessness than homeownership – nearly 34,000 households in England became homeless between October and December last year (2021), more than 8,000 of them were families with children.
“Right to Buy has already torn a massive hole in our social housing stock as less than 5% of the homes sold off have ever been replaced. Over one million households are stuck on social housing waiting lists in England, and with every bill skyrocketing, the government should be building more social homes so we have more not less.”
This scheme will only work if the money from purchasing tenants goes directly back into building new social housing.
Although there’s a lot to be said about the cons of the Right-to Buy-Scheme, there are a couple of pros to it.
Being able to get on the property ladder, especially for tenants in London
Less chance of being made homeless, the council cant issue eviction notices
Room sizes for bigger families, space and storage. Council houses can be twice the size of modern new-builds
Whether you agree or not with the Right-to Buy-Scheme, there is an obvious concern with lack of social housing already which no one can deny. Allowing people to buy their council house will create more and more uncertainty around social housing in the future unless something drastic changes. Our first thought would be councils building twice as many houses than are being sold.
What are your thoughts? Let us know below.
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