1.3m right to buy HA

floridaman

I see this has been announced in the queens speech - 1.3m HA rtb and 20% discounts. How will this effect house prices?

michaels

Apparently only about 15% could actually afford to take advantage, lucky as the cost to the exchequer if all did would be 11.2bn. If a significant number do buy and the sold houses are replaced 1 for 1 with new builds which wouldn't have been built otherwise it can only be a good thing.

Norman_Castle

michaels wrote: »

Apparently only about 15% could actually afford to take advantage.

Between 15 and 35% depending on region. http://www.housing.org.uk/media/blog/right-to-buy-extension-estimated-to-cost-12-billion/

michaels

Norman_Castle wrote: »

Between 15 and 35% depending on region. http://www.housing.org.uk/media/blog/right-to-buy-extension-estimated-to-cost-12-billion/

Thanks, the BBC rewrite of this press release made it sound like the £11bn was the total if all new RTB rights were exercised not only those who could afford it so actually potentially it will cost 11.bn.

The other thing is that the 35% afordability is in areas where there is arguably less need for replacement housing whereas in London and the SE where houses are shorest in supply the affordability is only 15%-20%

chucknorris

The discount %'s look high, my father in law would get the max discount % of 70%, but the London cash cap of £103,900 cuts down the actual discount to about 20% (based on the approx. value of his house at £525k).

Graham_Devon

michaels wrote: »

Apparently only about 15% could actually afford to take advantage, lucky as the cost to the exchequer if all did would be 11.2bn. If a significant number do buy and the sold houses are replaced 1 for 1 with new builds which wouldn't have been built otherwise it can only be a good thing.

Worth noting here that when they increased the "gift" for right to buy in the last parliament, they said the same thing, that one house will be built for every one sold.

It turned out that only 1 house was built / started for every six sold.

ging84

doesn't this undermine shared ownership
you can get a mortgage to buy a 35% share, which after a few years you might be able to buy the rest
or you can just rent, and get gifted the same sort of share

Norman_Castle

Graham_Devon wrote: »

Worth noting here that when they increased the "gift" for right to buy in the last parliament, they said the same thing, that one house will be built for every one sold.

It turned out that only 1 house was built / started for every six sold.

Unlike council right to buy, I expect housing associations will insist properties are paid for in full before changing ownership.

If this is properly funded it could provide 11bn plus 6bn(?) from private individual who are otherwise likely to continue renting. This will be controlled by housing associations who will build new homes because thats what they do.
There's potentially 17bn to fund new house building at a cost of 11bn to the government. There will also be extra employment for the building industry.

skater_kat

i'd like to know if the discount will apply to people who have shared ownership, i.e. you currently own 50% of your house and rent the other 50% from a housing association. Will these residents get a discount on buying the 50% off the housing association?

skater_kat

ging84 wrote: »

doesn't this undermine shared ownership
you can get a mortgage to buy a 35% share, which after a few years you might be able to buy the rest
or you can just rent, and get gifted the same sort of share

this is true, but you would have to get a housing association rental tenancy in the first place. this is hard to do considering the thousands of people on housing waiting lists.

skater_kat

also, its not exactly the same thing but many HA tenants have had the "Right to Acquire" for around 15 years or so now. the difference is that there is no discount with that scheme.