John Bibby
 
John is a Policy Officer at Shelter.

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By John Bibby

Right to Buy one-to-one replacement falling short in London

The commitment to build a replacement for every social rented home sold through the Right to Buy scheme is not being fulfilled in London, just as across the country. In 13 boroughs there have been exactly no replacement homes built for the 2,877 social rented homes sold.

We wrote recently about the national failure to replace social rented homes sold through Right to Buy. Back in December 2011, when the government increased the discounts available to tenants, they said that the revitalised scheme would “ensure every home sold is replaced”.[i]

The commitment to replace the sold homes was about as solid a commitment as they come. The announcement stated that:

“Ministers are committed to ensuring that there is no reduction in the number of affordable homes – so for the first time any additional home bought under the scheme will lead directly to the provision of a new affordable home for rent on a one-to-one basis.”

But since the commitment was made 26,184 social rented homes have been sold through Right to Buy across England and only 2,712 replacement homes either started or bought. The ratio of replacement has been ten homes sold for every one replaced, nowhere near one-to-one.

Of course it can take a bit of time to build a home, so we should expect a bit of lag in the statistics; but it’s important to remember here that we’re talking about housing starts, when work begins onsite, rather than housing completions – when the home is finished.

Right to Buy has always been particularly controversial in London due to the relatively large number of homes still in council ownership, huge number of people waiting for a social rented home, the typically high value of the homes bought cheaply by tenants, and the number of Right to Buy homes that end up in a poor condition in the private rented sector.

Just as in the rest of the country replacement in London is nowhere near approaching one-to-one replacement.

Across the city 6,973 social rented homes have been sold through Right to Buy since the discounts were increased and 825 replacements started or bought. While that still leaves a gaping shortfall of over 6,000 unbuilt homes, the ratio of sales to replacements is eight-to-one.

But using averages disguises the wide divergence across the capital in the level of replacements for homes sold through Right to Buy. Because while in some parts of London replacements are being built, in others there is nothing at all. So in one borough (Barking & Dagenham) the number of replacements approaches the one-to-one that was committed to, but in 13 there’s not been a single replacement.

At 2,877, the Right to Buy sales in these 13 boroughs accounts for nearly half of total London sales, but not one home has been started or bought to replace social rented homes lost. That’s a replacement ratio of 2,877-to-zero in boroughs that, together, have almost 100,000 people and families waiting for social rented homes (a full table with all the stats is reproduced below).

London’s not alone in having large pockets where barely any replacement homes are being built at all. In Manchester, despite 598 Right to Buy sales, only 2 replacement homes have been started. In Kent, despite 257 sales, there have been only 10 replacements.

It’s easy to get lost in the numbers when we talk about affordable housing, but it’s important to see this failure in context and to understand its implications.

The context in London is particularly bleak. In recent years, the number of people getting a raw deal in the private rented sector has swollen across the capital. Homelessness has increased. And social house building across parts of London has ground to a complete stop, reflecting the national trend.

The failure to replace homes sold through Right to Buy will likely mean a continuation of this trend. A third of Right to Buy homes end up in the private rented sector. Without replacements, the private rented sector will increasingly be the only option for the most vulnerable Londoners. For those who can’t access or afford private renting, the result will be homelessness.

The solution to all of this is clear; it’s building more genuinely affordable homes. And that starts with sticking true to one-to-one replacement.

Detailed borough-by-borough breakdown of Right-to-Buy replacements

Borough

Replacements started

RTB sales

Sales for each replacement

Social housing waiting list

Barking and Dagenham

417

488

1

11,024

Barnet

3

229

76

1,045

Bexley

NA

NA

NA

3,481

Brent

0

168

zero replacement

5,102

Bromley

NA

NA

NA

3,126

Camden

21

195

9

22,409

City of London

0

23

zero replacement

476

Croydon

0

175

zero replacement

5,102

Ealing

0

274

zero replacement

10,676

Enfield

37

287

8

2,237

Greenwich

0

567

zero replacement

11,375

Hackney

70

203

3

7,926

Hammersmith and Fulham

0

130

zero replacement

433

Haringey

0

383

zero replacement

9,203

Harrow

0

81

zero replacement

687

Havering

6

212

35

2,271

Hillingdon

0

308

zero replacement

3,606

Hounslow

5

154

31

6,842

Islington

61

345

6

17,860

Kensington and Chelsea

13

54

4

2,677

Kingston upon Thames

0

77

zero replacement

6,436

Lambeth

0

258

zero replacement

15,264

Lewisham

14

220

16

8,294

Merton

NA

NA

NA

7,625

Newham

19

372

20

15,582

Redbridge

3

133

44

7,804

Richmond upon Thames

NA

NA

NA

4,008

Southwark

21

556

26

13,436

Sutton

0

163

zero replacement

1,496

Tower Hamlets

100

284

3

20,425

Waltham Forest

0

270

zero replacement

20,635

Wandsworth

25

251

10

2,788

Westminster

10

112.88

11

4,378

London total

825

6,973

8

11,024

 


[i] It’s worth noting from the off that while there was a commitment to replace the homes, the replacement was never for like-for-like replacement. Every social rented home sold was to be replaced with an Affordable Rent home, which have rents of up to 80% of market rents, compared to social rents of roughly 50% market rent.

  • Rex Duis

    Great research by Shelter here. This is disgusting and an outrage! Worse still the fact the few replacement homes have most likely been switched to the so-called ‘Affordable Homes’ which for most people are still unaffordable! Politicians must be forced to act (in our interests for a change!) or get thrown out of Parliament.

    • A Landlord

      Yes, they have to be switched to Affordable homes, because the council homes were built in the 1960s. They can afford to charge low rents. New homes cost more to build, so they have to charge 2015 prices. A 1960s homes was built in an era of low building regulations. Current building regulations are stricter then those in the 1960s e.g. fire safety, electrics, sound proofing, ventilation, carbon footprint etc…

      • Rex Duis

        The costs may well have increased, but not by as much as 80% of market rents instead of 50% or less for council housing. That’s what a so-called ‘Affordable Home’ costs to rent so it’s not affordable for most people. And if council regulation costs are onerous, then they should be subsidised by the government for properties intended for social housing.

        I was complaining about social housing being replace with affordable housing instead of with social housing. Are you saying that social housing is dead now and no more social houses will be built?

  • A Landlord

    Why must it be necessary to replace a council home on a 1:1 basis?

    If you have someone who is a social housing tenant and they become a home-owner . The home is not lost, it is just transfered into private ownership. If that person had never bought their council house, they would still be occupying that home for the rest of their life. It would only back to the social housing stock if they died, quit their tenancy.

    May be what needs to be looked at is the number of high earners who have council homes for ‘life’. How can you have people on a £100,000 living in council housing?. How can they have that entitlement for life?.

    What Shelter are proposing, is council sell off their properties for £90,000 and then spend £250,000 building new ones to replace them. (whilst cost of existing homes may be around £180,000). Since you have a premium for new-builds.

    Should council / housing associations be buying up land to build social housing. For instance, they would put one bathroom. Where has a private new build would have en-suite bathroom as this is what people want. So why cripple our housing stock?.

    Instead of making classing a property as ‘social housing’. It should be the tenant who is entitled to pay social rents, with the state topping up the rent to market level. If the tenant starts to earn more money, they can pay market rents. If their incomes drops, they can go back to social level rents. The only should be, if the landlord is a council should give assured tenants and private landlords can give short-hold tenancies.

    In prime location such as London’s Westminister, I can image properties going for a million, so how can Shelter say a council tenant is entitled to a million pound house?.

    You have young women who get pregnant, to get a council house. This is why the council house waiting list is growing and growing.
    In fact, it encourages people into a no or low wage income, because they know those a criteria for getting a council house.

    If Council told people, they need to have a family income of £25,000 to get a council house, then suddenly you will see people trying to strive for such goals.

    Personally, I think social housing should be linked to your contribution to society e.g. if you have volunteering.

    Some of points are controversial, but it is necessary to have re-think of social housing.

    • Alan

      “If Council told people, they need to have a family income of £25,000 to
      get a council house, then suddenly you will see people trying to strive
      for such goals.”

      Here in Cornwall a family income of £25,000 would require at least 4 adults working full-time or having 8-10 part-time jobs between them. Most jobs are at minimum wages, seasonal and in short supply.
      That would mean that most families in Cornwall would be living rough on our streets because they could not get to the minimum family income level.

  • Mr Smith

    All assured tenancies should be sold off