A new report launched today by my London Assembly Labour colleague Tom Copley AM has found that the capital’s councils expect the number of homes sold under the Government’s reinvigorated Right to Buy scheme to far outstrip the rate they are able to build replacements over the next decade. ‘Out of Stock’ reveals a devastating scale of reduction in council housing stock and highlights the need for councils to be given new powers to properly invest in new social housing.
Drawing on new data provided by London boroughs the report estimates that based on current development plans around 10,300 council homes will be completed over the decade to 2023/24, compared to an estimated 16,100 Right to Buy sales leaving almost 6,000 fewer council homes by 2023/24.
The data shows that London boroughs expect 1.5 council properties to be sold over the next ten years for every new home that will be built. The erosion of the council housing stock is expected to be particularly stark in outer-London, where the boroughs currently forecast that two homes will be sold for every new home that is completed. This compares to 1.2 homes in inner-London.
The figures, based on London boroughs’ expectations of future council housing sales and completions, show that annual council housing completions are likely to peak at a level just below 1,900 in 2015/16, before declining starkly. This compares unfavourably to the pre-1980s peak of 27,235 council homes built in 1970.
The report also found that only 43 per cent of the revenue raised from RtB sales is expected to be spent on building new homes, while 30 per cent will be transferred to central Government, with the remainder being allocated to cover administrative costs. The result is councils being forced to top up funding to reinvest in new homes despite rapidly diminishing budgets and central government imposed restrictions on their ability to invest in housing.
The scale of expected reduction of almost 6,000 homes over the decade to 2023/24 illustrates the urgent need for councils to be given more powers to finance new social house building.