by Mark Johnston
Margaret Thatcher’s ‘right to buy’ scheme introduced in the 1980’s is set to be re-launched by the conservatives. The original ‘right to buy’ scheme was widely criticised for not reinvesting the proceeds generated by the sales of council houses in to new housing and therefore cutting social housing availability for those on low incomes.
The conservatives have however stated that this ‘new’ scheme will be more generous than the previous introduced by the labour party in the 80’s. the money from council house sales would this time be invested in to building new affordable homes to rent for those on low incomes that are currently stuck on housing lists. The government predicts that this scheme would create around 200,000 extra homes and 400,000 extra jobs, at a time when unemployment is at an all time high. It would also give more people the chance to own their own homes.
Housing minister, Grant Shapps has promised that every sale will be matched with a new affordable home, however many expert wonder how this will be achieved in practice. In this current climate there are now fewer council houses than housing association properties and therefore the right to buy scheme has a shrinking pool of potential purchasers.
David Cameron states that the right to buy scheme is part of plans to ‘fire up’ the British economy. He stressed that the government “is not just sitting back” in terms of boosting growth.
There are approximately still more than 2 million council homes that are still available to buy.
Figures show that right to buy sales last year stood at 3,900 in England, compared to well over 150,000 at the height of the right to buy boom in 1982, under labour the discounts offered to those wanting to buy their council homes was reduced which in turn discouraged people taking up the scheme. Therefore the only way to prompt more sales now is to significantly increase the level of discounts offered.
What is this scheme?
The right to buy scheme helps social tenants in England and Wales buy their council owned houses at a discount. This scheme is open to anyone who has been a council tenant for more than 12 months, providing they can secure a mortgage, although some properties may not be sold through this scheme.
If a tenant does qualify for this scheme they can get a discount on the market value of their property. The amount of discount available is currently based on how long they have been a tenant, where they live and also the type of property (a flat or house). The government has announced that they intend to increase the discounts offered to encourage council tenants to buy their own home.
Tenants should remember is that once they buy their own property they are then soley responsible for all of their own repairs and building upkeep. Also if they fail to pay the mortgage they could lose their home and because they are no longer a tenant, the council does not have to find them another home.
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