A new report says taxpayers with purchase rights have sold nearly £20 billion in sales over the past fifty years and contributed to the housing crisis in the country.
Thinktank Common Wealth said the right to buy is one of the “most iconic and outcome policies” of former Prime Minister Margaret Thatcher, whose council has sold 44% of the market cap of tenants at an average discount in England’s homes, with cash revenues of over £5.1 billion.
The policy is key to the Conservatives claiming that Britain is becoming a “democracy of property ownership”.
The study comes as Deputy Prime Minister and Housing Minister Angela Rayner promises to build more affordable homes and cut purchase and sale rights.
Thinktank’s report says the former council homes are now worth £430 billion (at 2024 price), and the estimated value of these homes is £430 billion (at £2024 price) after inflation and rising property prices since 1980.
In the payment, ThinkTank added that £194 billion represents “the value of giving away effectively through discounts”.
The report notes that there are two significant consequences for transfer of wealth from state to home buyers.
“First, due to the collapse of social construction, the worsening of the housing crisis – and its wedding with the market forces through private cross-subsidies, the Council was unable to cope with local housing demand and the supply of subsidized subsidies demand,” it said.
The second is “the weakening of the Council’s balance sheet, which was especially vulnerable when the austerity attacks began in 2010.”
Thinktank said the number of “no free housing interests now” is 1.6 times the value of the remaining stocks in the housing income accounts of local authorities in England, which is worth about £12.2 billion in 2022, more than double the total net liabilities and twice the form of debt securities and loans for local governments, and the December 2024 debt securities and loans.
“Financially, it is wrong for the public sector to sell such assets at such discounts given the unsustainable dynamics of asset price inflation,” the report said, “The sale of wrong reports: How the right of purchase is bought and sold: billions of dollars of public wealth purchased.
Last month, Rayner (Rayner bought a home as the right to buy a tenant) had a plan to build around 300,000 affordable homes in the June spending review.
The deputy prime minister added that at least 60% of these houses will be used for social rent related to local income, which means that about 180,000 homes will be delivered for social rent. This number is six times higher than the ten years in 2024.
Reiner also plans to tighter restrictions on purchasing rights to sell to maintain council housing stock, including extending the shortest time a council tenant must live from three to ten years of their homes to buy at a discounted price.
