Government urges councils to sell off high-value houses

Rooftops The move would reduce the housing waiting list, Policy Exchange said

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Councils should consider selling off their most expensive houses to build more cheap homes, the government says.

Downing Street backed a report by think tank Policy Exchange which said selling high value homes when they become vacant would raise £4.5bn a year.

That would be enough to build 80,000 to 170,000 social homes, the report said.

Labour said new homes were urgently needed but "driving out hard-working families on low wages from whole neighbourhoods" was not the answer.

In its Ending Expensive Social Tenancies report, Policy Exchange argues the move could create the largest social house building programme since the 1970s - giving the economy a kickstart.

Neil O'Brien, the think tank's director, told the BBC that social housing would still exist in very expensive areas under its proposal, but there would just be "less of it".

Start Quote

The government should not force them to arbitrarily sell-off social homes, breaking-up mixed communities”

End Quote Jack Dromey Shadow housing minister

"The truth is I don't believe anybody has the right to live in the most expensive parts of town.

"People do have a right to get housed, just not in the very most expensive areas," he said.

He also suggested that the overall number of people waiting for social housing, currently around 1.8 million, could be reduced by about 500,000 if the scheme was implemented.

'Failed policies'

The prime minister's official spokesman said: "This is something that councils can choose to do already.

"Councils should be looking for ways to use their social housing stock as efficiently as they can. The waiting list for social housing has increased a lot over passing years.

"They need to think about how they can use that social housing stock efficiently.

"If they can sell high-value housing to invest in more social housing and find more homes for more people, then that is certainly something they should look at."

But Labour said the coalition's "failed" polices were "making the housing crisis worse not better".

Shadow housing minister Jack Dromey said: "Councils and housing associations should make effective use of their housing stock but the government should not force them to arbitrarily sell off social homes, breaking up mixed communities and driving out hard-working families on low wages from whole neighbourhoods."

He said the government should use a bank bonus tax to fund 250,000 affordable homes and "put unemployed builders back to work" and boost the construction industry.

'Lucky family'

Expensive social housing - which Policy Exchange defines as housing worth more than the average property in each region - accounts for 21.8% of the total social housing stock in the UK, it says.

This equates to 816,000 properties - out of a total of 3.78 million - which the think tank says could raise up to £159bn if sold.

It says London alone has more than £70bn of expensive social housing.

About 3.5% of the total stock becomes vacant every year owing to people moving out or dying, the think tank said.

This meant the government could sell a total of 28,500 properties each year, raising £5.5bn a year. The figure would stand at £4.5bn after paying off the debt held against the stock, the report said.

Mr O'Brien argued that many hard-working people might want to live in a nicer area or in a bigger house but could not afford to.

"Rather than having one lucky family with a very expensive house, you would have two families perhaps desperately waiting for social housing, now having a roof over their heads.

"That seems fairer to me," he added.

Alex Morton, Policy Exchange: "One in five social houses is worth more than the regional average"

The think tank also said the move would be "extremely popular" with all sections of society, claiming that 73% of people, including social tenants, think people should not be given council houses worth more than the average property in a local authority.

'Dramatic erosion'

Critics say such a move would push the least well-off out of expensive streets, and into new ghettos.

The National Housing Federation, which represents housing associations, says many towns would be "cleansed" of "hardworking people who can't afford to pay high prices".

Labour MP Karen Buck, who represents Westminster North, is concerned that lower income families, particularly in London, will be forced out of more affluent areas creating segregated communities of rich and poor.

Ms Buck also argued that the Labour government's £8bn social and affordable housing building programme was cut by 60% when the coalition came to power.

Housing Minister Grant Shapps - who is in favour of a sell-off - said the government had introduced "radical reforms" to "get Britain building" and to reduce social housing waiting lists.

They included investing £19.5bn public and private funding into an affordable housing programme "set to exceed expectations and deliver up to 170,000 homes".

Councils could now offer fixed-term tenancies to new tenants to make sure "social housing goes to those in greatest need", he added.


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  • rate this

    Comment number 1072.

    This whole article has been deliberately twisted by both Policy Xchange and BBC.

    How can a tennancy be "expensive" when the council own the property?

    They control the rent and rates.

    The Policy Exchange document should have been titled "Releasing Equity from Desirable Council Property - Mmmm, nice".

    Policy Exchange is a registered charity. Who funds it?

  • rate this

    Comment number 1071.

    Bottom line cons want more expensive houses for the illegal immigrants and there cronies.

  • rate this

    Comment number 1070.

    @ 1036.Ex Tory Voter

    1033.Ragnarokkr actually corrected me:

    "that's not an argument against social housing & welfare provision, it's a reflection of many of the other things wrong in society such as poor wages & a lack of housing"

    But your point "The minimum wage does not reflect the actual cost of living"... actually very interesting.

    Question: what is the point of minimum wage then?

  • rate this

    Comment number 1069.

    This is Labour Party's fault who caused this mess, opening doors and letting imigration get out of control. I think the only soultion now is to re house people further up North, Scotland has a lot of open space and would make sense to ship people who are on benefits and imigration to there. No point in putting non workers in big cities. People out of work could be trained in house building too.

  • rate this

    Comment number 1068.

    ok so the man doesn't like it, i'am sorry mr BBC its just that this govt & previous govt's get away with it time after time,so next time someone tells you its a free country yes it is unless you have a go at the govt, who by the way seem to be making it up as they go along? when did you last hear of any other govt giving the rich a 5% tax cut during a double dip recession??

  • rate this

    Comment number 1067.

    When the FSA fine the banks for £millions, they use the money to reduce the fees the banks/insurers pay the FSA. Fees which are already built into the price of the products we buy from banks/ insurers everyday.

    As the taxpayer has already paid £billions to underpin the financial services industry, why doesn't the government divert these fines to use in social projects, creating jobs etc?

  • rate this

    Comment number 1066.

    "He is simply a better entrepreneur in choosing the most advantageous housing solution"
    You are correct! He is a better entrepreneur! So why am I contributing to his lower cost housing? I say there are many entrepreneurs just like him enjoying council housing & building their wealth by poncing off the taxpayer.
    Just answer this: When do you have to stand on your own two feet?

  • rate this

    Comment number 1065.

    If council houses in wealthier areas are to be sold off, does that mean the new ones are to be built in more deprived areas? It seems that could cause a lot more social problems than it solves...

  • rate this

    Comment number 1064.

    So a Tory Think (?!) tank does not want the poor to live in expensive ( define expensive) homes - move to ghettos?
    Does anyone really think that a) the new leases will not be used to force people out of these homes, b) the money will actually be reinvested in new stock
    Also, in theory, the new stock should be built BEFORE the sale of these houses to maintain social housing numbers. Fat chance

  • rate this

    Comment number 1063.

    A quick scan of the comments suggests a big left wing bias!
    My view is that it is sensible to sell 20% of expensive housing for re-investment to house upwards of 500,000 people while at the same time giving a massive boost to the construction industry - simples! All those people come off the housing list and the out of work job totals go down!

  • rate this

    Comment number 1062.

    Sell expensive council houses to build cheaper ones eh, how's that going to work then? Presumably most the dwellings concerned are of high value because they happen to exist in a prestigious postcode area so building 'cheaper' houses isn't going to solve the problem, unless we are talking garden sheds of course...

  • rate this

    Comment number 1061.

    council housing should be the most basic living accommodation we can provide, and be limited to a set number of rooms. Unfortunately, 13 years of Labour have created a generation of benefit dependant spongers who should never be rewarded for living off society and expecting the working population to feed their increasing offspring. Selling one pricey house to build 5 social homes is sense at last

  • rate this

    Comment number 1060.


    Minimum wage in 2002 was £4.20 so it's gone up 45% in that time.

    As for you wanting a 25% drop in house prices, have you forgotten what caused the banking crisis?

  • rate this

    Comment number 1059.

    //voice of reason
    The houses will be sold off in large numbers (not one by one as would normally happen) to an obscure company about which very little is known.//

    There are stories of certain families getting absolutely luxurious accommodation under the current system. Makes you wonder who's making the decisions.

  • rate this

    Comment number 1058.

    The shortage of social housing is preventing many people from moving to find work.

    How many would love to be guaranteed a house for life expecting to live always at the expense of those who are prepared to work

    It makes good common sense to sell expensive properties and build more houses with the proceeds.

  • rate this

    Comment number 1057.


    1. ..wages going down.. cost & living going up... one over takes the other?

    Is this not the purpose of Minimum Wage? To provide a minimum wage upon which a certain standard of living can be maintained?

    2. a deeper bitter sense of “them and us”.

    Surely better to house 2/3 families in a less built up area than 1 family in a sought after location?

  • rate this

    Comment number 1056.

    Home owners are subsidesed also...through unscrutinised benefits handed out no worries. As for government, purely a tool of the Rich fat cats in the City. Democracy simply does not exist in Britain a virtual totalitarian state. My solution...End tax havens use the wealth to crate jobs homes etc etc and things might be better and less dependancy. The British Rich are EVIL.

  • rate this

    Comment number 1055.

    Sounds like a great idea in principle. Until one postulates the details.

    The houses will be sold off in large numbers (not one by one as would normally happen) to an obscure company about which very little is known.

    The sales prices will be impossible to unravel and it will all end up looking and smelling of a corrupt little deal.

    Years later, a whistle blower will reveal all.

  • rate this

    Comment number 1054.

    @1041. ropper

    Have I missed something?

    There is a way for 1.3m people to get social housing who are currently on the waiting list without adversely affecting public finances.

    At the moment a select minority benefit by living in expensive locations at the expense of those who don't get anything. Isn't this exactly the kind of left wing ideal you should be arguing for?

  • Comment number 1053.

    This comment was removed because the moderators found it broke the house rules. Explain.


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