This short piece of research, commissioned by the Joseph Rowntree Foundation aimed to better understand likely poverty impacts of the extension of Right to Buy to housing associations and the associated sale of higher value local authority stock.
This research for the Joseph Rowntree Foundation aimed to better understand the likely poverty impacts of the extension of Right to Buy to housing associations and the associated sale of higher value local authority stock.
It drew on a range of data sources in order to explore:
- the number of homes likely to be sold through RTB and associated ‘high value’ local authority housing sell-off
- the likely number of low cost rented lettings which would be lost
- based on current patterns, where would low-income households who would have occupied these properties live instead (inlcuding particular consideration of the private rented sector and hidden households)
- what would the likely impact of this be on poverty and the housing benefit bill?
Understanding the likely poverty impacts of the extension of Right to Buy to housing association tenants
This report, commissioned by the Joseph Rowntree Foundation, examines the impact of the extension of the Right to Buy to housing association tenants, and the sale of higher value local authority dwellings, which will provide the funding for the Right to Buy. The analysis first estimates the likely scale of uptake of both schemes, and then looks at the impact on lettings, rents, poverty and welfare costs.
The analysis has concluded that the tenure of housing built to replace that which is sold has a critical effect on poverty. Only if the replacement housing is at similar rent levels to that which is sold can a negative impact on poverty be avoided. The report shows:
• around 1.3 million housing association tenants will gain the Right to Buy, but only around 180,000 of these are eligible and able to afford to exercise it;
• total uptake of the Right to Buy over the first five years of operation is estimated at 128,000;
• around 10 per cent of local authority housing nationally is high value for its size and region. The proportions vary dramatically between authorities, and the worst affected areas will see a reduction in over 50 per cent in social housing available for letting, at least until replacement stock is built;
• if stock is replaced like-for-like in terms of tenure, the Right to Buy and local authority sales will eventually have a positive impact on the availability of low-cost housing and on poverty;
• if social rented homes are replaced with Affordable Rented ones, rent levels, poverty and housing benefit costs will all increase;
• if social rented homes are replaced with shared ownership or Starter Homes these will not be affordable to households who would otherwise have accessed the social rented homes. This will increase the number of poorer households renting in the private rented sector, which will increase poverty and housing benefit costs.