FabSwingers.com forum: Right to Buy Council Houses - immediately private rented out.

By (user no longer on site) OP
over a year ago

Article in the Independent today:-Councils are selling off their already-limited supplies of housing stock and allowing former council tenants to profiteer as buy-to-let landlords.

There are rules to deter the immediate sale of properties bought under Right to Buy but renting is unregulated, so the Government’s hefty discounts on sales have turned former council tenants into buy-to-let landlords overnight. Council leaders have branded the situation a “national scandal”.

In April 2012, David Cameron increased the cap on the maximum discount to £75,000, or £100,000 for London. In the borough of Haringey 396 homes have been sold under Right to Buy since April 2012; of those, 28 are already being rented out to people on housing benefit at a cost of more than £265,000 a year to the public purse.

Of 82 council homes sold under the new Right to Buy scheme in Corby, Northamptonshire, 25 are now rented by people on housing benefit, costing £85,063.95 since April 2012.

Money raised through sales is supposed to go to building more affordable homes, but building work cannot keep up with the speed of sales. More than 20,000 homes have been sold under Right to Buy since April 2012 while just 3,364 replacement social homes have been built.

Sales of council homes are likely to increase after the Government announced a further discount in July, raising the maximum discount for a house to 70 per cent of its value. Homes can now be bought at a discount of up to £77,000, or £102,700 in London, which will increase every year in line with inflation.

It all seems a bit crazy to me, as the rent for Social Housing is so much cheaper than private rent. We are taking them out of the stock, yet then paying Housing Benefit for other people moving into them, but at a much higher rate. So the tax payer has lost out all ways, yet they are not even building at the rate of keeping up with the right to buys that are taking place. So it will become worse and worse!

Plus the new private rent tenants, do not even have the protection of a long term tenancy, as they would with a council/housing association property.

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By *bi HaiveMan
Forum Mod
over a year ago

Cheeseville, Somerset

It's wrong.

Simple.

Right to buy should also come with clauses ensuring the purchaser is the resident, rather than the landlord.

I don't blame those doing it - I blame the system that allows them to do so.

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By *uckandbunnyCouple
over a year ago

In your bed

Should this link to the conservative thread?

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By (user no longer on site) OP
over a year ago

"Should this link to the conservative thread?"

I didn't see that thread. I wasn't trying to make it political - just seems a crazy loophole that needs to be closed!

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By (user no longer on site)
over a year ago

The whole right to buy scheme was the end of meaningful affordable rented accommodation in this country.

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By *icketysplitsWoman
over a year ago

Way over Yonder, that's where I'm bound

"The whole right to buy scheme was the end of meaningful affordable rented accommodation in this country."

As a friend in her twenties said to me, why do we even have to talk about affordable when discussing the roof over your head? It's an essential and should be regulated to ensure we can have a roof over our heads that is realistically priced.

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By *ophieslutTV/TS
over a year ago

Central

"The whole right to buy scheme was the end of meaningful affordable rented accommodation in this country."

Absolutely! It had some meets but our private rental market is just so wrong atm. I think we need massive regulation of the rental market which could also lower house prices as a knock on benefit.

We should definitely have masses more social housing too.

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By *icketysplitsWoman
over a year ago

Way over Yonder, that's where I'm bound

"Should this link to the conservative thread?"

Not strictly. Labour had the idea and then Thatcher ran with it and developed it.

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By (user no longer on site)
over a year ago

It's ludicrous. With the lack of affordable council accommodation pushing people to privately rent meant people had to claim housing benefit. The cost of renting a private ex council house is 3 times that of council rent.

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By (user no longer on site)
over a year ago

New affordable housing is better built for people in work which are at least double the current rent prices. Anyone on a low income will need to claim housing benefit to afford to live in them

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By (user no longer on site)
over a year ago

So where have these new landlords ended up moving to? Hopefully its not another rent to buy property though surely there's criteria for who can apply

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By *uckandbunnyCouple
over a year ago

In your bed

"Should this link to the conservative thread?

Not strictly. Labour had the idea and then Thatcher ran with it and developed it.

I was being naughty.

Sorry.

You could say social housing is very illiberal.

Saying it's essential means that it should be provided. However whilst thatmay have good intentions once you take price out of any market demand shoots up.

Which means selecting who gets a house on other factors. Which can be just as unfair.

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By (user no longer on site)
over a year ago

It's scandalous when there's such a shortage of social housing. Councils have to follow the right to buy rules (and rightly so) so can't refuse a request that meets the criteria. But their borrowing powers are constrained so they don't have the funds to build new properties once there's a shortage, even when there's a reliable funding stream (the rents) to repay it. Some of these loopholes must be closed or the situation will just get worse and worse.

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By *uckandbunnyCouple
over a year ago

In your bed

Increase supply to out strip demand and prices will fall. Whether social or private rent.

The cause is a lack of housing or too many people. Neither are popular with voters to control.

So we play games around other issues whilst the underlying root cause is too many people for too few houses in the places were people want to live.

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By (user no longer on site)
over a year ago

So lets say someone has paid full weekly rent for 20 years (more than a mortgage) worked full time, raised a family on buttons in the meantime. Is that not then an entitled investment on their part?

Housing association rents are increasing dramatically that I don't see them as affordable or any different to private rented housing. I know this because my partner is a landlord of two properties (not bought from the council btw) The rent is very similar, around about the £100 mark. That's in the North East thoguh.

I'm only asking the question from the other side of the argument so don't bite me heed off lol its certainly an emotive subject.

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By (user no longer on site)
over a year ago

It don't make sense to me, if your a.council tenant and you buy your house to rent it out you have to find somewhere else to live either private rent our take out a mortgage on another property, so you'll be paying the rent on your ex council right to buy home and rent or mortgage on where your living, that's going to cost you loads more than just living in your rights to buy house, I see no insentive to do this

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By (user no longer on site) OP
over a year ago

"So lets say someone has paid full weekly rent for 20 years (more than a mortgage) worked full time, raised a family on buttons in the meantime. Is that not then an entitled investment on their part?

I'm only asking the question from the other side of the argument so don't bite me heed off lol its certainly an emotive subject. "

That is a fair point, however during that 20 years, all repairs to that property, and planned maintenance - new kitchen maybe or bathroom etc will have been funded for them. Then they buy it, heavily discounted and rent it out. It is not even so much, the person renting it out, I don't blame them. They are not doing anything illegal, but generally the private rent is higher, so the amount paid in housing benefit is a lot more. I agree with housing benefit, it is there for a reason, but we need to look at what we can do to cut the costs of it. This loophole is not helping !

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By *uckandbunnyCouple
over a year ago

In your bed

"It don't make sense to me, if your a.council tenant and you buy your house to rent it out you have to find somewhere else to live either private rent our take out a mortgage on another property, so you'll be paying the rent on your ex council right to buy home and rent or mortgage on where your living, that's going to cost you loads more than just living in your rights to buy house, I see no insentive to do this "

Buy on right to buy at reduced price. Sell to a landlord at market rates. Rent another house whilst pocketing any capital gains from the sale. Simples.

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By (user no longer on site)
over a year ago

In my borough it's as dear to rent as it is to buy. People who buy a council property cheap then rent it out to cover the cheap mortgage,buy another property and have some of that mortgage covered by the rent from the council property they are renting out. My mother in law bought her council house for £25,000.00. Sold it for £140,000.00 3 years later. Bought a property abroad outright with the profit and retired there. To rent her house now would cost approx £250 per week,maybe more

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By (user no longer on site)
over a year ago

If you rent off the same private landlord for 20 years would you have the right to buy that property at a reduced price? No

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By (user no longer on site)
over a year ago

Buy on right to buy at reduced price. Sell to a landlord at market rates. Rent another house whilst pocketing any capital gains from the sale. Simples.

oic you mean council tenants are buy their homes and selling them straight on to private renters? Makes sense now, I though it ment the tenants were buying to rent out themselves

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By (user no longer on site)
over a year ago

There is a clause in the agreement when you buy from council/association that your not allowed to sell within 5 years. If you do choose to sell you HAVE to sell it back to them for the price you paid.

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By (user no longer on site)
over a year ago

"There is a clause in the agreement when you buy from council/association that your not allowed to sell within 5 years. If you do choose to sell you HAVE to sell it back to them for the price you paid."

(Sell it to them within the 5 year period)

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By (user no longer on site)
over a year ago

There are around 600,000 empty homes in the UK (2013 figures).

Why don't the councils buy these, renovate them and sell on under right to buy to tenants.

Or sell on housing associations atond help alleviate the housing crisis?

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By (user no longer on site)
over a year ago

When our Housing association bought the housing stock from the council in Sunderland they decided to demolish a number of housing estates (thousands of homes)promising to build new affordable houses, they forced compulsory purchase orders on tenants who had bought their house and guess what? They ran out of money and sold the land to private companies. The company broke up communities and most people were forced into private properties. Its the large organisations who have created the housing shortages, not right to buy tenants.

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By *eMontresMan
over a year ago

Halesowen

council houses were intended for those who could not afford to buy or to rent decent accommodation. The rents are/were subsidised, and a lot less than the private sector for comparable accommodation. Then there's all the repairs and refurbishment.

So after having tax payer subsidised accommodation, they get to buy it at a reduced price - wtf!

It should remain in the public sector to be allocated on a means tested basis. Those who can afford to rent privately should be moved out to make way for those in need.

There should never have been, nor should there ever be, a right to buy.

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By (user no longer on site)
over a year ago

The right to buy was the biggest bribe in political history!.

I've lost faith in any party ever getting to grips with any problems, all they do is cover them up until their out of power and then stupid greedy electorate complain about ooooh what a mistake that was 4 years ago. like they didn't know where that tax cut came from.

How in the hell do these people think the rich keep getting richer every year.

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By *isscheekychopsWoman
over a year ago

The land of grey peas and bacon

It's swings and roundabouts the person who bought the property then renting it to someone on housing benefit I can only assume are on a low income, said landlord is then providing a home to a family that may or may not end up presenting as homeless therefore in turn taking one family off the homeless register by providing them with a home. Under the localism act local authorities can discharge homeless duty into the private sector so no one anymore is guaranteed to be given social housing.

There are many that do acquire council accommodation simply for the right to buy aspect of it. I do think it was a good idea of the scheme but the trouble is thatcher promised to built more social housing with the profit from right to buy however that never happened. It went in to build various buildings in towns and cities across the country and not to build further social housing to aliviate the lack of social housing from right to buy.

We are now reliant on housing associations to build social housing as in many local authorities they are unable to build new council housing. It is what it is and it's not going to go away. While private renting is not secure it is indeed housing therefore having a roof over your head.and people will have to accept that they may never get social housing. Housing associations are now only providing a fix term tenancy and not a secure tenancy.

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By *isscheekychopsWoman
over a year ago

The land of grey peas and bacon

"There are around 600,000 empty homes in the UK (2013 figures).

Why don't the councils buy these, renovate them and sell on under right to buy to tenants.

Or sell on housing associations atond help alleviate the housing crisis?

Because local authorities just don't have the money to do so...central government have slashed budgets...the largest council in Europe being one of the worse effected councils to be hit with the cuts in budget. Front line services have been slashed and the statutory homeless services are running on empty...it is what it is some councils just can't afford to do it

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By (user no longer on site)
over a year ago

"council houses were intended for those who could not afford to buy or to rent decent accommodation. The rents are/were subsidised, and a lot less than the private sector for comparable accommodation. Then there's all the repairs and refurbishment.

So after having tax payer subsidised accommodation, they get to buy it at a reduced price - wtf!

It should remain in the public sector to be allocated on a means tested basis. Those who can afford to rent privately should be moved out to make way for those in need.

There should never have been, nor should there ever be, a right to buy."

There are two major housing associations in my area. My parents pay just over a £100 a week in rent and that does not include free repairs. They have to pay towards the cost. The other association offer new windows etc to tenants but an additional charge goes on top of the rent for it. Genuine right to buy tenants should not be vilified for others abusing the system. As I have said in an earlier post, private rent is the same as social up here.

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By *eMontresMan
over a year ago

Halesowen

Housing associations are not council housing. Housing associations are commercial organisations running on a not for profit basis.

I was talking about council houses, which are subsidised

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By (user no longer on site)
over a year ago

Many tenants were council tenants before associations bought housing stock out so their rights remained the same. Are you saying you wouldn't take advantage of the right to buy scheme if you were in a position to do so. You would quite happily pay rent for the rest of your life (dead money) or be given help to get on the property ladder after having already spent thousands to live in the property?

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By *ophieslutTV/TS
over a year ago

Central

The terrible thing is that it's you and I who are being shafted, as tax payers.

We are propping up employers paying tiny wages, and often them paying no business tax, so that staff have to claim benefits, paid out as extortionate rent to buy to let landlords, which increases the house prices where we live. So we end up with next to nothing as disposable income. Which keeps our economy fairly stagnant.

All's good for the richer, those with properties to let out etc. The rest of us are doomed.

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By (user no longer on site)
over a year ago

I live in social housing on a new build estate (7 years old). I would love to be able to buy my property so I have something to leave my son. I can't get a mortgage, yet I pay £430 per month in rent. Yes, I am in receipt of some housing benefit because of my childcare costs as I work but this will end when my son is 12.

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By (user no longer on site)
over a year ago

Most of these houses people are leaving their kids are fucked, one good earthquake and a third of Britain would tumble. Let's try leaving our kids educated and rounded and able to build their own houses with jobs and a decent environment instead of relying on parents for handouts and subsidies

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By (user no longer on site)
over a year ago

If it's not illegal, people will do - it's a sad state of affairs but the councils can't stop the process as it stands.

I'm a landlord but I've never bought that type of property, I can totally see why people do though. No easy answer really, that will change overnight.

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By *eMontresMan
over a year ago

Halesowen

I don't blame the people for doing it, but it sticks in my craw that taxpayers subsidise their accommodation, then they get gifted £200k or so of equity, whilst others who scrimp and scrape to get by have to forgo foreign holidays, sky TV, take aways, plasma TVs etc etc, in order to get started on the housing ladder.

Life is tough, I'm all for helping the poorest in society, but many don't know they're born.

I think there should be basic, decent affordable accommodation for those who genuinely can't afford to rent or buy. But to then reward them with a big slug of capital/equity is a slap in the face for the taxpayers who fund it. Council housing should stay in the public sector and be allocated on a means tested basis, with UK nationals coming first.

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By *lueeyedscouseMan
over a year ago

Liverpool

Must admit i have not read posts as to many ...but i baught my family home on a right to buy (i had an alcoholic as a mum and a dead beat as a dad i lived with my gran ) .... So when she died the was talk of my house being empty etc ... Wile my mates played football dreaming of playing for efc or lfc my dream was to become a property millionaire..... (sorry for going on ) but long story short i got a mortgage for right to buy ....it made heads turn ....i wanted to rent it out but couldn't ....by law but i went to staples and got a tenecey (spelt wrong) agreement and put a tennent in it ...... Dont get me wrong i dont agree with mobility scruffs having cars etc ....or right to buy ....but i had a bad child hood etc and i achieved my dream by prooving everyone wrong and owning my home ....im not a greedy landlord ... But i am am achieving landlord .

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By (user no longer on site)
over a year ago

"Article in the Independent today:-Councils are selling off their already-limited supplies of housing stock and allowing former council tenants to profiteer as buy-to-let landlords.

Of 82 council homes sold under the new Right to Buy scheme in Corby, Northamptonshire, 25 are now rented by people on housing benefit, costing £85,063.95 since April 2012.

Plus the new private rent tenants, do not even have the protection of a long term tenancy, as they would with a council/housing association property.

It's called free market capitalism.and empowerING the poorest members of society.

U can't have ur cake n eat it.

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