One third of London’s ex-council homes ‘being rented privately’

13 Jan 14
More than one-third of the council homes sold in London under the right-to-buy programme are now being let out by private landlords, figures compiled by Labour have indicated

By Richard Johnstone | 13 January 2014

More than one-third of the council homes sold in London under the right-to-buy programme are now being let out by private landlords, figures compiled by Labour have indicated.

According to data published by London Assembly member Tom Copley, more than 52,000 properties – or around 36% of the 145,506 leaseholds sold in the capital under the controversial programme since the 1980s – are now rented. 

Copley, who is Labour’s assembly housing spokesman and deputy chair of the housing committee, said government reforms were needed to address the ‘worst excesses’ of the scheme. Among the problems he highlighted was the volume of sales, which has led to local authorities being forced to rent back former council homes at higher market rates in order to meet their statutory homelessness duties.

Copley said Right to Buy had helped to fuel the increase in the Housing Benefit bill, increased the pressure on local authority waiting lists and led to more Londoners to seek homes in the ‘under-regulated’ private-rented sector.

‘This shows that Right to Buy currently represents incredibly poor value for money to taxpayers,’ he said.

‘Not only did they pay to build the home in the first place, they then subsidised the considerable discounts offered to tenants and then missed out on the rental income that would have covered the build costs. Now, we have the indignity of London boroughs renting back their former council homes at higher market rent levels, once again costing taxpayers through the nose.’

Copley called for mandatory agreements to be included in right-to-buy sales stating the homes cannot be let through the private-rented sector.

The current system of discounts on home values, which the coalition government has increased, should be abolished and a new system introduced whereby local authorities retain an equity stake in any property sold, he added.

Councils should also have a ‘right not to sell’ if they believe it would not be in the community interest to do so or that it would harm their housing operations.

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