Well, Cameron has most likely lost my vote with this one. I really hate how divisive politics has become. And, as a BTL landlord, I am heartily sick of all the landlord knocking that is going on (like everything, there are some good, some bad, and whether you like it or not, private rented sector provides a necessary service and should be treated like any other business).
That said, this RTB extension makes no sense and is wrong on so many levels.
First, the government does not own the housing stock it is proposing to give away. Housing associations do. As another poster said, they finance their social renting operations through massive borrowing. They will need to be compensated (assuming Cameron's proposal is legal). This means more borrowing and/or a large publicly funded subsidy for a relatively small number of people, who enjoy some of the more secure tenancies in the country.
Secondly, a massive disincentive to housing associations to invest (even assuming they are able to buy like for like in a possibly inflating property market).
Thirdly, proposed method of funding apart from borrowing is for councils to sell off their more expensive properties and reinvest in building on brown field sites on 1:1 basis. In fact this will result in less social housing. Even allowing for regional variations, and assuming promises of ring fencing are genuine (and I seem to have heard that one before), it will be virtually impossible to build 1:1 on brownfield sites. By their nature, these will be more expensive, due to contamination and other issues. If all these brown field sites are so wonderful, why have they been standing empty for years (locally we have a number of beautiful listed buildings literally falling into disrepair, some owned by...the council!).
Fourthly, many of the discounted homes will find themselves back in the private sector (as happened with original RTB...I own one myself, which I bought from the mortgagee; on one level a good deal....but which required lots of time and money spent on it to bring it back into habitable condition after its owners trashed it after taking their frustrations out on it after the bank repossessed). You don't have to be Einstein to work out, this will result in less social housing, more relying on the private rented sector.
I can see the appeal of placing some type of restrictive covenant limiting the RTB houses to owner occupiers, or some type of criteria being applied. RTB currently triggers an element of repayment of the discount if sold within five years. The problem with extending this is that it would make the houses hard, if not impossible, to mortgage, so would defeat the whole idea behind the policy (which is crackers) any way.
Why make the distinction between HA renters and private renters? Given we are not yet in a Stalinist state, I am being somewhat tongue in cheek. But there are lots of hard working renters in the private sector who may well see this giveaway as a kick in the teeth and a double whammy (less security, higher rents, and no subsidy).
Personally, in my view, owning your own home is a good thing to aspire to, but it is not, and should not be a right. Having access to secure decent housing should be everyone's right, and this ill conceived policy makes this less likely. Call me cynical, but I think it is a lame attempt to appeal to what remains of the working class by evoking some Thatcher-esque sell-off, although I am quite mystified why anyone in Conservative Central Office thinks this will work.