Councils in London are spending over £22m each year renting back homes sold under the Right to Buy, according to a new report. Right to Buy: Wrong for London, from Labour’s London Assembly Housing Spokesperson, Tom Copley AM, also identifies that the number of Right to Buy homes now in London’s private rented sector has hit at least 54,000. Mr Copley said that at a time when the need for homes at social rent level far outweighs the numbers being built, it was “reckless” of the Government to continue with the Right to Buy. He said it was failing London and called for its abolition.
Responses to Freedom of Information (FOI) requests submitted by Mr Copley to all London councils, found that the number of Right to Buy homes now in the private rented sector has risen by at least 11,825 in the last five years to approximately 54,000. These figures are considered conservative, as some local councils did not provide data. 42% of homes sold through Right to Buy in London are now being rented out by private landlords at market rates (up from 36% in 2014).
The capital needs 30,972 new low-cost rented homes every year, according to the 2017 London Strategic Housing Market Assessment (SHMA). With demand outstripping supply just 7,905 low-cost rented homes have been built in the last five years – councils are being forced to rent back properties formerly sold under the Right to Buy to use as temporary accommodation to meet the needs of homeless families.
Mr Copley’s report found that at least 2,333 Right to Buy homes are now being rented by local authorities, with Newham alone renting back 808 of these at a cost of £12.9m per year. The total yearly cost to councils renting back these properties is at least £22,345,760. Westminster Council are renting back 650 former council homes, but couldn’t provide a figure for the annual cost of this. Based on the average cost of renting back council homes across London this could be in excess of £8m a year.