The Flexible Right To Buy? – Thatchers Vision?

• UK has the second-largest social housing sector in the EU, and over half of tenants in the sector want to own their own home. • The Right to Buy works for some, but some social tenants live in expensive properties which they cannot afford to buy.

• Almost 700,000 local authority owned homes are in areas where median house prices exceed £250,000. Over 200,000 of these are in areas where median house prices exceed £500,000.

• Social tenants eligible for the Right to Buy should be given a Flexible Right to Buy, entitling them to buy a new home, using the value of their Right to Buy discount.

• The tenant’s previous home would then be sold, funding the discount and raising additional revenue.

• A conservative estimate of the impact would see 21,000 tenants take advantage of the scheme with £2 billion of discounts on £9 billion of stock and net receipts of £7 billion.

• An ambitious estimate of the impact would see 197,000 tenants benefit, with £83 billion of stock and £21 billion of discounts and net receipts of £62 billion.

• Housing stock would be better matched to people’s circumstances, with a cooling effect on overheated local markets.

• Some friction would be removed from labour markets, resulting in improved productivity and wages.

Read the full paper here

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Rhoda Klapp
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Rhoda Klapp

OR..the free market could be allowed to work. Or the demand side could be reduced by immigration control. The government has had decades to fix housing, hasn’t done it, tries to keep everybody happy and pleases no-one. When something doesn’t work for decades, isn’t it time to try something else?

Samarkand Tony
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Samarkand Tony

“Or the demand side could be reduced by immigration control.” No, that’s just a xenophobic fantasy. Housing pressure in the UK is down to the overwhelming move towards London of the Northern population over the last 70-80 years, in which time every government has refused to allow nearly enough new housing to be built where people actually want to live. With 10-20 million Northerners to house south of Birmingham, at most immigration would be the insignificant figures at the end of the stats. In practice, it may have actually relieved housing pressure somewhat, because immigrants are generally happier to live… Read more »

Rhoda Klapp
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Rhoda Klapp

Three(?) million people have an effect on demand. When it comes to supply, should we build where the demand is or try to encourage people to want to live elsewhere? That is where the market will tell you, if you listen.

Samarkand Tony
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Samarkand Tony

We’re actually in a situation where immigration to the London economic zone is dwarfed by internal migration. As you may notice in places like Bradford, immigrants are willing to live up North – they’re not evenly distributed around the country, they’ve chosen places the longer-established residents of this country have all-but abandoned, and are to an extent priced out of London. This has the effect of moving economic activity away from London that would otherwise take place there, and so reduces pressure on housing. London’s always had a revolving population of immigrants, and the size of that population has remained… Read more »

Matt
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Matt

I never really understood the logic behind right to buy. People who have been receiving discounted rent are offered a substantial discount on buying a house, while those people who work hard and pay market rates pay for it all, while struggling to buy anything.