London Mayor and new Conservative MP Boris Johnson, is urging the government to change its plan to extend Right To Buy into a scheme more similar to Help To Buy.
Johnson says the Tory plan to offer Right To Buy sales discounts to housing association tenants should instead become an equity loan scheme similar to Help To Buy.
The Conservatives indicate that up to 1.3m housing association tenants could buy their homes at a discount under the party’s proposals, which were an idea made at the May general election.
The Financial Times say Johnson and the Greater London Authority, (the capital’s governing body) believe equity loans would remove the need to sell high-value council houses and would also allow the Treasury to fund the scheme without it appearing on the public sector balance sheet, in the same way that Help To Buy equity loans do. This will ensure that housing associations are fully recompensed.
Currently some 800,000 housing association tenants have a “right to acquire” homes under smaller discounts, but the government says it will significantly boost those discounts and lengthen the scheme to those who currently have no purchase rights at all, estimated to be about 500,000 people.
If the discounts match those given to council tenants, the sums involved would be significant: the maximum discount is £77,900 across England, except in London boroughs, where it is £103,900.
The Conservatives say every house purchased will be replaced “on a one-for-one basis” with more affordable homes and no-one will be obliged to leave their home – although the Tory manifesto before the May 7 poll assured only to build a maximum of 400,000 new homes during the term of the new government.
Since Margaret Thatcher introduced Right To Buy for council properties in 1980, just over two million council homes have been sold and only 345,000 replacements have been built.