LGA warns right-to-buy scheme is becoming ‘unsustainable’



Almost £6 billion has been given out in discounts through the government’s right-to-buy (RTB) scheme since the size of the discount was increased in 2012, analysis by the Local Government Association reveals.

The LGA, which represents more than 350 councils in England and Wales, warns that the scheme is becoming unsustainable, with councils struggling to rebuild homes as quickly as they are being sold.

The size of the discounts available was increased in April 2012, and as a result, the average discount has increased by 150% to more than £67,000 in 2020/21. LGA says this has also led to a quadrupling in the number of RTB sales.

Councils are also not able to keep all of the money from RTB sales, which LGA explains that they have only been able to replace around a third of homes sold since 2012, impacting their ability to provide housing for homeless and vulnerable families.

While RTB has helped many families get on the housing ladder, LGA analysis suggests 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.

Councils also need to be able to combine RTB receipts with government grant funding, such as the Affordable Homes Programme, and transfer funding from sales to ALMOs or housing companies to give them greater flexibility over how new council housing is delivered.

LGA housing spokesperson David Renard says: “Councils want to urgently address the number of people on waiting lists for a council home and stuck in temporary accommodation. At a time of an escalating cost of living crisis, we urgently need to build more council homes, not have less.”

“It is becoming impossible for councils to replace homes as quickly as they’re being sold and they are increasingly having to do so with far less money than the property sells for because of discounts being offered.”

“Every home sold that isn’t replaced risks pushing more families into the private rented sector, driving up housing benefit spending and rents and exacerbating our homelessness crisis.”

“RTB continues to enable many families to achieve their dream of getting on the housing ladder and owning their own home. However, without reform of the scheme, future generations will not enjoy the same opportunity,” Renards adds.