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  • FIRST POST
    • Zizou
    • By Zizou 17th Jul 17, 4:00 PM
    • 6Posts
    • 0Thanks
    Zizou
    Right to Buy - Unethical/Sinister change?
    • #1
    • 17th Jul 17, 4:00 PM
    Right to Buy - Unethical/Sinister change? 17th Jul 17 at 4:00 PM
    Hi

    I was using right to buy calculator righttobuy.gov.uk/right-to-buy-calculator and have noticed that they have switched off auto-calculation for 'Insert an estimated value of your property'.

    When I spoke to them they said now you have to enter the value of the property you are trying to buy, which is based on the market value (inflated - estate agent prices), and then it will calculate your discount for e.g.

    3 bed flat in East London Zone 2 in London was sold by an estate agent for £800,000 so the council will now take this figure and then add whatever discount is available in that area (104,000). This flat will now cost you £696,000 to buy! (And the funny this is that bank can only lend you up to £600,000, and the rest you have to put that as a deposit!)

    The government have changed the rules snidely behind the backdoor, making it more difficult to buy!!
Page 2
    • ScorpiondeRooftrouser
    • By ScorpiondeRooftrouser 17th Jul 17, 11:05 PM
    • 1,702 Posts
    • 2,471 Thanks
    ScorpiondeRooftrouser
    True if it is used as council housing.

    If it's sold under RTB, those huge discounts are definitely council, and therefore taxpayer, funded.
    Originally posted by Red-Squirrel
    What's going on at the moment? Every time somebody says that RTB is taxpayer funded, somebody comes along and starts arguing that renting out council housing isn't taxpayer funded, as though anyone has disputed that. I am getting deja vu.
    • martinsurrey
    • By martinsurrey 18th Jul 17, 8:06 AM
    • 2,919 Posts
    • 3,561 Thanks
    martinsurrey
    Really - how? - Housing Revenue Accounts do not take subsidies from the 'tax payer' that would be illegal. However, individuals do have subsidies (HB) HRA (council and HA's) are simply social enterprises. The difference between the market rent and the social rent are about the profit margins and business model. The social housing rent is driven by the costs of provision - market rents are driven by profit requirements of the landlords. 'The Council' do not pay for council housing - the tenants do.
    Originally posted by TheGardener
    If the council own an asset that could generate revenue of £10,000 on the open market but accept £6,000 from someone for it, the £4,000 difference is a subsidy as defined by the World trade organisation.

    That subsidy is an opportunity cost to the council, one which they make up for through either cutting other services, or taxing more.
    • FBaby
    • By FBaby 18th Jul 17, 8:36 AM
    • 15,625 Posts
    • 39,106 Thanks
    FBaby
    Over the last year or two almost all councils have changed their tenancy agreements to make 'succession' only available to partners, not their children.
    Oh yes, that's the other one. Single mum gets a nice council house, then 'dates' her boyfriend for years so that she can keep her council home and entitlement to HB, and then when they finally decide to make it official, boyfriend who earns a very good income moves in, sale his place and buy the council home at discount, making a nice profit!

    A few of them have dared posting here!
    • readingfan
    • By readingfan 18th Jul 17, 8:41 AM
    • 21 Posts
    • 55 Thanks
    readingfan
    Politics about 'right to buy' aside - the 'tax payer' does not fund council housing. It is wholly funded thought tenants rents unless the tenant in question is in receipt of HB - in which case they are unlikely to get a mortgage.
    Originally posted by TheGardener
    I've worked in the RTB section of a LA and I can assure you there are many, many tenants on benefits including HB, that buy their homes.

    Also, the calculator does go on to say "Please note that as the market value you enter will only be an estimate, the level of discount you could get may go up or down. You will only know exactly how much your home is worth once it has been valued by your landlord after you apply. We would advise that you don’t make any formal financial or legal arrangements before you’ve had your landlord’s valuation"

    Further, if you don't agree with your landlord's valuation (which will be done by a RICS Accredited valuer and not an estate agent) you can get your own done.
    Last edited by readingfan; 18-07-2017 at 8:45 AM.
    • Norman Castle
    • By Norman Castle 18th Jul 17, 8:55 AM
    • 5,953 Posts
    • 4,708 Thanks
    Norman Castle
    If the council own an asset that could generate revenue of £10,000 on the open market but accept £6,000 from someone for it, the £4,000 difference is a subsidy as defined by the World trade organisation.

    That subsidy is an opportunity cost to the council, one which they make up for through either cutting other services, or taxing more.
    Originally posted by martinsurrey
    The Housing Revenue Account states that housing revenue cannot subsidise or be subsidised by other means. It has to be self financing and it cannot subsidise other council services. Any deficit in the council housing budget will not result in services being cut or increased taxation.
    Don't harass a hippie. You'll get bad karma.
    • Norman Castle
    • By Norman Castle 18th Jul 17, 9:19 AM
    • 5,953 Posts
    • 4,708 Thanks
    Norman Castle
    A few of them have dared posting here!
    Originally posted by FBaby
    Many rtb threads are started by newbies with the intention of promoting a reaction. I suspect these "newbies" are one attention seeker.
    Don't harass a hippie. You'll get bad karma.
    • ScorpiondeRooftrouser
    • By ScorpiondeRooftrouser 18th Jul 17, 9:39 AM
    • 1,702 Posts
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    ScorpiondeRooftrouser
    The Housing Revenue Account states that housing revenue cannot subsidise or be subsidised by other means. It has to be self financing and it cannot subsidise other council services. Any deficit in the council housing budget will not result in services being cut or increased taxation.
    Originally posted by Norman Castle
    So where do you think the subsidy for right to buy ultimately comes from? We are talking solely about RTB subsidies here. not ongoing rental, which is an entirely different matter.
    • Norman Castle
    • By Norman Castle 18th Jul 17, 10:14 AM
    • 5,953 Posts
    • 4,708 Thanks
    Norman Castle
    So where do you think the subsidy for right to buy ultimately comes from? We are talking solely about RTB subsidies here. not ongoing rental, which is an entirely different matter.
    Originally posted by ScorpiondeRooftrouser
    It comes from the loss of potential profit from the sale of an asset. The housing stock is separate from other council assets so the loss will not be funded through council tax payments.
    Don't harass a hippie. You'll get bad karma.
    • ScorpiondeRooftrouser
    • By ScorpiondeRooftrouser 18th Jul 17, 10:24 AM
    • 1,702 Posts
    • 2,471 Thanks
    ScorpiondeRooftrouser
    It comes from the loss of potential profit from the sale of an asset. The housing stock is separate from other council assets so the loss will not be funded through council tax payments.
    Originally posted by Norman Castle
    And who owned the asset?
    • 00ec25
    • By 00ec25 18th Jul 17, 11:55 AM
    • 4,298 Posts
    • 3,640 Thanks
    00ec25
    If the council own an asset that could generate revenue of £10,000 on the open market but accept £6,000 from someone for it, the £4,000 difference is a subsidy as defined by the World trade organisation.

    That subsidy is an opportunity cost to the council, one which they make up for through either cutting other services, or taxing more.
    Originally posted by martinsurrey
    what an excellent post

    the HRA must, as stated by law, be self balancing, but that does not, as you so rightly point out, address:
    a) the opportunity cost; and
    b) the replacement cost

    the rents charged are not "market rate", they are "subsidised" rate
    • Norman Castle
    • By Norman Castle 18th Jul 17, 1:23 PM
    • 5,953 Posts
    • 4,708 Thanks
    Norman Castle
    And who owned the asset?
    Originally posted by ScorpiondeRooftrouser
    The housing department of the council which is not funded or subsidised from council tax payments.
    Don't harass a hippie. You'll get bad karma.
    • Guest101
    • By Guest101 18th Jul 17, 1:26 PM
    • 14,477 Posts
    • 14,153 Thanks
    Guest101
    The housing department of the council which is not funded or subsidised from council tax payments.
    Originally posted by Norman Castle
    It's still taxpayer funded.
    • Norman Castle
    • By Norman Castle 18th Jul 17, 1:30 PM
    • 5,953 Posts
    • 4,708 Thanks
    Norman Castle
    It's still taxpayer funded.
    Originally posted by Guest101
    How much of my or your council tax payments are given to the housing department?
    Don't harass a hippie. You'll get bad karma.
    • BJV
    • By BJV 18th Jul 17, 1:33 PM
    • 2,230 Posts
    • 3,346 Thanks
    BJV
    The Housing Revenue Account states that housing revenue cannot subsidise or be subsidised by other means. It has to be self financing and it cannot subsidise other council services. Any deficit in the council housing budget will not result in services being cut or increased taxation.
    Originally posted by Norman Castle
    No but surely that would mean that they have less money to invest, repair and re-home people who need it ????

    If I have to sell fund. I have a moral duty to make sure that I get the best bang for buck I can so I can re-invest in services i.e houses for the future. The right or wrongs of right to buy aside there are still not getting market value. In a way they are discriminating against people who have had to use private land lords who when circumstances change will not be eligible for a massive discount
    Last edited by BJV; 18-07-2017 at 1:35 PM.
    Happiness, Health and Wealth in that order please!
    • Guest101
    • By Guest101 18th Jul 17, 1:42 PM
    • 14,477 Posts
    • 14,153 Thanks
    Guest101
    How much of my or your council tax payments are given to the housing department?
    Originally posted by Norman Castle
    I couldn't tell you, I don't know what banding your property is, or whether you receive a single person discount.


    These properties are only self funding on paper.


    If I had a property which cost me £300 to maintain, so I set the rent to £300, it's self funding. BUT if the market rent is actually £600, I am losing £300.
    • Zizou
    • By Zizou 18th Jul 17, 3:30 PM
    • 6 Posts
    • 0 Thanks
    Zizou
    I don't know about others, but I have been paying full rent and basically they will be deducting this as a discount!
    • Zizou
    • By Zizou 18th Jul 17, 3:34 PM
    • 6 Posts
    • 0 Thanks
    Zizou
    Market rate are fixed by the greedy estate agents for their commissions!

    A house could worth £400k but estate agents do bidding war so the house when its sold ends is around £450k!
    • fairy lights
    • By fairy lights 18th Jul 17, 3:39 PM
    • 7,827 Posts
    • 25,755 Thanks
    fairy lights
    I don't know about others, but I have been paying full rent and basically they will be deducting this as a discount!
    Originally posted by Zizou
    And you think that's unfair...how exactly?
    • Cheeky_Monkey
    • By Cheeky_Monkey 18th Jul 17, 3:41 PM
    • 1,195 Posts
    • 2,229 Thanks
    Cheeky_Monkey
    Market rate are fixed by the greedy estate agents for their commissions!

    A house could worth £400k but estate agents do bidding war so the house when its sold ends is around £450k!
    Originally posted by Zizou
    That just goes to show how little you know about the housing market
    • Guest101
    • By Guest101 18th Jul 17, 3:42 PM
    • 14,477 Posts
    • 14,153 Thanks
    Guest101
    I don't know about others, but I have been paying full rent and basically they will be deducting this as a discount!
    Originally posted by Zizou
    - So you aren't paying full market rent really are you? If it's basically being paid towards the value of the house?

    Market rate are fixed by the greedy estate agents for their commissions!

    A house could worth £400k but estate agents do bidding war so the house when its sold ends is around £450k!
    Originally posted by Zizou
    Then the house is worth £450,000 and was not worth £400,000 you don't seem to understand the market
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