The Social Housing Bill gets its Commons second reading today and some of the proposed changes are fairly significant. Extending the Right to Buy qualifying period from three years to ten, reducing maximum discounts, and exempting newly built social homes for 35 years are all in there. Whatever your politics, these will have real effects on housing supply in areas like mine where the stock of social rented homes has been hollowed out over decades.
I cycle past two former council estates on my commute and the patchwork of ex-RTB properties with different windows, doors, and extensions is a visual history of the policy in action. Some are clearly well maintained, others less so. The new build exemption strikes me as the most consequential change, assuming it survives committee. If councils and housing associations know their new stock cannot be sold off for 35 years, the incentive to actually build presumably increases. Or am I being hopelessly optimistic? Interested in views from landlords, tenants, or anyone who has dealt with social housing allocations.
Green, the exemption sounds sensible on paper but the bottleneck has never really been RTB. It is land and planning. Housing associations already have the incentive to build. They cannot get planning permission quickly enough, they cannot buy land at prices that make social rent viable, and local authorities do not have the staff to process applications. A 35 year exemption changes none of that.
Extending the qualifying period to ten years is interesting though. That does slow the bleed. Whether it survives the Lords stage is another question. The discount reduction might actually be the one that matters most in practical terms, because the gap between what tenants pay and what the property is worth has been the real driver of sales in high value areas.
I would be curious to see the numbers on how many RTB sales are happening in the first three to five years versus the six to ten range. If most sales happen after year five anyway, moving the threshold to ten has limited real effect.
Green, interesting thread and timely..
I have always had mixed feelings about RTB. In principle it gave people a genuine stake in their community and I have seen lives transformed by it. In practice it also created a secondary market that enriched a relatively small number of people at the expense of long term housing supply.. I knew a chap in Sunderland who bought his council flat under RTB in 2014 at a 50% discount, then let it out within two years through a management company. He was essentially arbitraging the taxpayer. Whether you consider that enterprise or exploitation probably depends on your politics.
Chap’s point about planning is well taken. You can tweak the RTB rules all day long but if the build rate does not increase then you are just rearranging existing stock. The 35 year exemption is a start but housing associations will need actual capital grants to build at scale, not just reassurance that their stock won’t be sold from under them..
Will be watching the debate tonight with a cup of tea and a healthy dose of scepticism.. Cheers!
Second reading is just the starting gun. Most of the meaningful clauses will get watered down in committee. Happens every time.