Section: Right to Buy

£5 billion national discounts threatening future of Right to Buy

Posted 04.03.20
Local Government Association (LGA): Further reading

While Right to Buy has helped many families get on the housing ladder, the LGA says the scheme faces an uncertain future unless councils are given the flexibility to set discounts locally and retain 100% of sales receipts to fund the replacement of homes sold off under the scheme.

The national RTB discount, set by government, currently averages 42% of market value, meaning council properties can be bought for almost half price.

Since the Government increased the size of the RTB discount in April 2012, the average discount on a property has increased by 137% to more than £63,000.

As a result, the LGA estimates that tenants have benefited from £4.9 billion in Right to Buy discounts in order to buy their own home.

The new analysis by the LGA shows that 79,119 homes were sold between 2012/13 and 2018/19 - but with councils only able to use a third of each retained RTB receipt to build a replacement home, only around a quarter (21,720) of the homes sold have been replaced in the same period.

To ensure RTB works for future generations, the LGA is calling on the Government in the forthcoming Budget to allow councils to set discounts locally and keep 100% of sales receipts to replace homes.

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Reporting on March 2020

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