Councils in England will have more freedom on how they spend the
money from homes sold through Right to Buy (the sale of a council
house), to help them build the homes needed in their communities,
under reforms announced today (Saturday 20 March 2021) by Housing
Secretary Rt Hon MP.
Today’s package will make it easier for councils to fund homes
using Right to Buy receipts, including homes for social rent, and
give them greater flexibility over the types of homes they
provide to reflect the needs of their communities.
It will also give councils more time to use receipts and to
develop ambitious building programmes. The Government wants homes
supplied using Right to Buy receipts to be the best value for
money, and to add to overall housing supply, to help towards
delivering 300,000 new homes a year across England by the
mid-2020s. This set of reforms, combined with the abolition of
the borrowing cap in 2018, gives councils substantially increased
flexibilities to build the homes England needs.
These changes take effect from 1 April 2021, with the exception
of a new acquisition cap, which will be introduced from 1 April
2022, on a phased basis.
Housing Secretary Rt Hon Robert Jenrick MP said:
“Councils have a crucial role to play in increasing housing
supply, including building more affordable and social housing.
“I have listened to local authorities who responded to our
consultation on the use of Right to Buy receipts and I am
delighted to announce a package of reforms providing authorities
with the flexibilities they need to develop ambitious build
programmes and help get people on the housing ladder.”
Cllr James Jamieson, Local Government Association Chairman, said:
“The LGA has long-called for reform to Right to Buy and we are
pleased government has engaged with us and acted on councils’
concerns.
“Extending the time limit for spending RTB receipts and
increasing the proportion of a new home that councils can fund
using receipts will boost councils’ ability to build
desperately-needed affordable housing for local communities.
“We now look forward to working with government to implement
these reforms and it is good it will work through any specific
local challenges some councils may face as a result of the
acquisitions cap.”
ENDS
Notes to Editors:
· New measures
include:
oextending the
time councils have to spend Right to Buy receipts from three
years to five years
oincreased cap on
the percentage cost of new homes councils can fund from Right to
Buy receipts raised from 30% to 40% per home, making it easier
to build replacement homes
oallowing receipts
to be used for shared ownership, First Homes, as well as
affordable and social housing, to help councils build the homes
their communities need
ointroducing a cap
on the use of Right to Buy receipts for acquisitions to help
drive new supply.
·On 14 August
2018, alongside the Green Paper A New Deal for Social
Housing, the Ministry of Housing, Communities and Local
Government (MHCLG) published a consultation on how local
authorities could use the receipts they obtained from sales of
council housing under the Right to Buy to deliver replacement
homes, and how those replacements were measured.
·The original
consultation paper can be found at: https://www.gov.uk/government/consultations/use-of-receipts-from-right-to-buy-sales.
·We received a
total of 198 responses to the consultation, which we have
analysed to inform the package of reforms. Our published response
can be found here: https://www.gov.uk/government/consultations/use-of-receipts-from-right-to-buy-sales
