The government’s housing strategy contains no figures on the number of new homes that will be built to replace those sold under proposed changes to social housing tenants’ right to buy.
The strategy, published this morning, contains proposals to offer a new mortgage indemnity scheme, a £400 million scheme to kick-start stalled development and pledges to give tenants larger discounts if they want to buy their homes.
It repeats ministers’ commitment that each home sold under the new regime will be replaced with a new home.
But it does not outline the exact discount tenants will receive, how much revenue sales are expected to generate or how many new homes will be built as a result.
The document says the government is looking at raising the caps that apply to the discounts on their homes tenants can apply for at present.
The document says: “There is a balance to be made between offering generous discounts and having enough receipts to fund the building of replacement homes. We will consult shortly on the appropriate levels.”
The government says its intention is to raise the cap to a level where the average discount will be up to half the value of the home being sold. Some of the money raised will be used to pay for some of the cost of building a new home.
The strategy says: “Our proposal is that right to buy receipts will first be used to meet debt on additional properties sold, then will meet Treasury and council forecast receipts, and that the balance will be available for investment in replacement properties. Our initial modelling shows that the expected receipts will provide a sufficient contribution to the cost of replacement homes.”
The government will also consult on the best way to redisribute the money raised through the right to buy. It says there are three options:
- Local delivery - where receipts are left with the council for reinvestment locally
- National delivery - where receipts are allocated through a national programme run by the Homes and Communities Agency and the London Mayor in the capital
- A combined approach - “where councils able to deliver one-for-one replacement and secure good value for money in commissioning retain the receipts, while those who prefer not to lead on commissioning replacement surrender receipts for national distribution”.
The strategy says: “Under the local delivery model, councils would generally be better placed to identify local needs and opportunities, but less able to secure the wider efficiencies that could be achieved through a national programme.”