By The announcement that Boris Johnson is considering re-introducing the ‘right to buy’ social housing policy of the 1980’s is one answer to housing market issues but is not the whole answer.
‘Right to buy’ was a vote winner when introduced by Mrs Thatcher but the policy does nothing to address long standing issues within the housing market and simply delays a proper review of the housing sector.
There is little doubt that Boris Johnson has touched a nerve with this idea.
Home ownership undoubtedly scratches an itch, a desire among the electorate to be homeowners and the discount to make it more affordable to a wider population.
But caution is required as selling social housing needs to be matched with the building of more social housing supply.
At the same time support for the private rented sector is also required as there are many who don’t want to buy for a variety of reasons.
For those workers from the EU and elsewhere, for professionals moving around to further their career, and for the retired who might wish to sample a different lifestyle then the private rented sector remains a key option and is an essential part of the housing mix.
The re-introduction of Right to buy is a clear indication that property remains an integral part of political policy.
However, it should be just one option among a range of options that meet the widely differing needs of people in the housing market.
Although the policy will only apply in England for the moment there is little doubt that momentum will build for it to be re-introduced in Scotland.
Why would Scottish social housing tenants not want equitable treatment to match their English counterparts?
It would be inconceivable for Scottish tenants not to want to benefit from heavily discounted housing.
David Alexander, the chief executive officer of DJ Alexander Scotland, commented:
While this policy will be a vote winner for Boris Johnson in key regions the implementation of this plan does not address the need for substantially more housing as a whole.
If it is introduced in the same way that it was in the 1980’s, then the key issues which have dominated the housing market for the last two decades will simply be exacerbated by the move.
There is also no doubt that, despite the SNP’s ideological objections to selling off social housing, there will be insurmountable pressure to match the policy in Scotland as tenants, who are also voters, would demand that they benefit from discounted house prices in the same way as English tenants.
Interestingly, it was the sale of council housing in the 1980’s that led directly to the substantial growth of the private rented sector.
The sale of social housing only exacerbated the need for more housing as demand continued to exceed supply.
This policy will only work if the funds gained from social housing sales are reinvested in more social housing rather than simply absorbed into other Government spending.
As ever with all changes in policy there will be consequences and mitigating against the unforeseen results of major shifts in options need to be factored into any change.
The result will only be positive if it is matched by an increase in the size of the housing market to match growing need.
Anything else will simply shift the demand to another time and another part of the market.
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