The current Right-to-Buy system only allows councils to
keep a third of each RTB receipt to build a replacement home and prevents local
authorities from borrowing to make up the shortfall. A new analysis by Savills,
commissioned by the LGA, examined the impact of continued restrictions on
councils’ ability to borrow to build new homes. It reveals that:
·
Two thirds of councils will have no chance of
replacing homes sold off under Right to Buy on a one-for-one basis in five
years’ time unless a significant restructuring of the scheme takes place.
·
Around 12,224 homes were sold under RTB last
year. Faced with ongoing borrowing restrictions and based on the levels of
sales remaining consistent, the analysis estimates that in 2023 councils would
only be able to replace approximately 2,000 of these homes.
·
Less than a third of councils would be able to
sustain any kind of one-for-one replacement of homes sold under the scheme in
five years’ time.
Read more on the LGA website.
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