03 September 2004
Applications by council tenants to buy their homes have plummeted since the government slashed discounts in London and the Southeast, new figures reveal.
Just 110,121 tenants applied to purchase homes in England under the right to buy scheme in 2003/04 — down 42% on the 189,231 applications in the previous year.
In April 2003, the Office of the Deputy Prime Minister cut the maximum available discount in 41 councils from £38,000 to £16,000.
This change, however, has yet to have an effect on sales. ODPM statistics show 69,577 homes were sold in 2003/04 — up by 10% from 63,395 the year before. Most of these were applications made before the changes, which helped push the total sold through RTB to 1.7 million.
A closer analysis reveals that the biggest fall in applications came in London — down by 78% from 57,636 to 12,506. In the Southeast, there was a 43% drop from 12,232 to 6,925. There were also reductions in other parts of the country where discounts remained the same.
One reason for the fall was the last-minute surge in applications in the final quarter of 2002/03.
David Thompson, housing policy consultant at the Local Government Association, said many tenants had been afraid that the change in the RTB rules would be tighter than turned out to be the case.
'As soon as the government announces a review, people make decisions,' he said. 'They get out their mattress money and exercise their RTB.'
In spite of an across-the-board drop in applications last year, discounts should be reduced in regions where affordable housing is in short supply, added Thompson.
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