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ALMOs warn of Right to Buy ‘leaking bucket’
ALMOs have warned that the Right to Buy is a “leaking bucket” as new figures reveal that such organisations fell well short of replacing council housing stock lost through the policy last year, despite increasing development and acquisitions.
In its annual survey published today, the National Federation of ALMOs (NFA) said that the sector built or bought 1,949 homes in 2018. ALMOs are wholly owned council companies that manage social housing stock.
That is an increase of 38% on the previous year, with newly built homes accounting for 1,280 of the added stock.
However, ALMOs sold off 2,813 homes under the Right to Buy over the same period, meaning the homes built and acquired made up only 69% of those lost.
Not including acquisitions, only 46% of the homes sold were replaced – with the vast majority at affordable rent, which tends to be more expensive than social rent.
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Under the Right to Buy, famously introduced by Margaret Thatcher and later reinvigorated by David Cameron in 2012, council housing tenants can buy their homes at significant discounts with councils able to keep only a small portion of the proceeds.
Eamon McGoldrick, managing director of the NFA, said: “[ALMOs] have continued to build new homes, deliver services on behalf of their parent local authorities, and contribute to the well-being of communities.
“However, the survey also shows the impact that Right to Buy is having on the stock of council housing, with ALMOs only able to replace 69% of the Right to Buy sales this year.
“Whilst we welcome the recent changes to local authority finance which will support the building of a new generation of council housing, unless the government implements the flexibilities to Right to Buy that we have been calling for, it is like a leaking bucket; the sector will continue to lose more council homes than it can replace.”
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The NFA survey also found that ALMOs planned to build 1,801 homes over the next 12 months and acquire another 713 after the government lifted the borrowing cap on council housing in October.
Overall, the 31 ALMOs in the sector currently manage 417,913 homes, including 1,969 on behalf of other social landlords and 1,875 in the private rented sector.
Official figures released last week showed that Right to Buy sales fell 20% from October to December 2018 compared with the same period the previous year.
