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25.09.15

NHF proposes ‘voluntary agreement’ to extend Right to Buy to housing association tenants

The National Housing Federation (NHF) is consulting its members on a voluntary agreement to extend Right to Buy to housing association tenants.

The move was announced during the National Federation of Housing conference yesterday (24 September), where communities secretary Greg Clark said: “Your tenants share the same hopes and dreams as everyone else.

“They live in the same towns, their children go to the same schools, they have the same ambitions for themselves and their families. They should be given the same opportunity, if they want it, to own their home.

“There is no reason why signing a tenancy agreement with a housing association should mean signing away your aspirations to be a homeowner.”

Under the deal, ministers would circumvent legislation to extend the Right to Buy scheme to 1.2 million housing association homes. These associations would then voluntarily agree to sell their homes to any tenants who want to buy them.

A DCLG spokesman said: “We want to help anyone who works hard and aspires to own their home turn their dream into a reality. The NHF have voluntarily come forward with a proposal, which the government will now consider.”

During the conference yesterday, Clark said the proposal presented by NHF’s boss, David Orr, was in three parts.

“The first is that the opportunity of extending the Right to Buy will be embraced by the sector. In Keeping with the housing association tradition to empower and meet the needs of their tenants, associations would give the chance – not just of some of your tenants, but to everyone who wishes to take it – to own their home.

“The second part of David’s proposal is that the sector will be a major force in building new homes. Every home sold would trigger a new home being built by a housing association, on a one for one basis. For every tenant who exercises the Right to Buy, our housing stock would rise by one.

“The third part of David’s proposed agreement is to make a historic change, to provide the means for every tenant who wants to – new or existing – to have the opportunity to acquire a stake in a home that can increase over time.”

The centrepiece of the ‘voluntary’ aspect of the move is that associations would not be compelled to sell stock under legislation, but instead entering a voluntary arrangement with the government – thus maintaining the independence of the sector.

Despite this, a government spokesman has said that if housing associations do not comply with the policy, Whitehall will “bring forward measures forcing them to offer it to tenants”.

And in the consultation document, it is made clear that if the association does not agree to support the voluntary agreement, the government “will bring forward primary legislation in the Housing Bill (due in mid-October) to compel you sell your properties”.

The proposal put forward by NHF said: “This offer would provide a significant increase to the supply of new homes in England... In return, housing associations would be fully compensated by the government for the cost of the discount. There would be a presumption that housing association tenants would have the right to purchase a home at Right to Buy level discounts, but associations would have discretion not to sell the home under some circumstances in order to manage their business and charitable objectives.

“This means that in some cases, housing association tenants would be offered a portable discount to purchase an alternative property to the one that they live in. Housing associations would have the freedom to replace the properties sold with alternative tenures such as shared ownership where this is more appropriate.”

The proposal added that associations would retain the discretion not to sell, such as when a property is in a rural area and could not be replaced or where it is adapted for special needs tenants.

But John Healey MP, shadow minister for housing and planning, criticised the proposed changes to the Right to Buy extension, calling them proof of how the Tory’s “increasingly chaotic” political pledge is “unworkable and wrong”.

He said: “This is clear sign of a government running into trouble with their flagship election policy. It looks like ministers are trying to strike backroom deal with housing association landlords to deliver a policy which they fear they can’t deliver themselves.

“It is being rushes to fit their political timetable ahead of Conservative Party conference, when it should have been announced in Parliament.

“After five years of failure on housing, the millions of people struggling to cope with their housing costs deserve a real plan for more affordable homes to rent and buy. And we need a new wide debate about how the country’s deepening housing crisis can be tackled.”

The deal has to be agreed by 1,400 housing associations in the next eight days, with a deadline set for 5pm on Friday next week.

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