To wonder how Labour’s Right to Buy on privately rented houses would work?

[Bearbehind]

Just read something this morning about Labour proposing Right to Buy on privately rented properties - how would that actually work?

How can they force a private landlord to sell at a discounted rate?

Also, if one of the requirements is you have to have been renting the property for several years, that’s just going to lead to less secure tenancies because landlords will make sure tenants cannot qualify for this.

It seems like a bonkers idea to me

ps don't tell TomPinch, but between you, me and the gatepost, I hear theres been a few cases since 1952...

@Passthecherrycoke none of your comments make any sense. Housing associations are not private landlords. They are bodies which are given grants by the taxpayer to build houses and provide affordable housing. While it’s less than idea for the affordable housing stock if they are forced to sell their housing at a discount, it’s not the same as forcing a private landlord to sell. And having your property confiscated is not a legitimate cost of doing business.

Also this is likely to make housing even more expensive if the government funds the “discount”. More money chasing fewer properties with no likelihood that a single extra house will be built as private landlords are generally ill equipped to do that.

As others have pointled out, if the taxpayer does fund the discount it’s also effectively a large chunk of free money randomly allocated to those who live in private rented housing. The poorest won’t benefit as they are reliant on housing benefits and won’t get mortgages. Why on earth should we be giving out such sums to people who are among the least likely to need them when we have a housing crisis and general funding crisis in our public services. Right to buy in the public sector has probably been the number one cause of the housing crisis. We should not make it worse by repeating it in the private sector.

We need a major program of house building to alleviate the shortage of housing both for rent and to buy. We don’t need to give bribes of taxpayers money to a few people to get them to vote labour.

Also Tom pinch compulsory purchase has strict limits to ensure it is necessary for the purpose (eg if for road building that the road cannot take another route). It’s also done at market value. Not the same as forcing a landlord to sell their property so someone else can own it at a discount which may or may not be repaid by the government.

The first bit of legislation to come in will compel landlords who neglect their property to give tenants the option to buy at reduced rates

Sorry but how is that different to what we have now.

If a place is in a state you don’t pay the same price as if the place was in good condition.

The whole thing is ridiculous.

What happens to the properties that the council have leased off private landlords and let out to tenants

On the face of it isn’t that just allowing council tenants to buy what appears as council housing. IYSWIM.

I thought Labour didn’t approve of council house sell offs

How are these tenants supposed to get a mortgage and how will a mortgage company be if Labour want to sell a property to a tenant with a 50% discount and the owner has a 75% mortgage.

Are they going to be happy

QualCheckBot

None of that will happen because as the legal analysis shows, a right to buy will not contravene the ECHR. It seems that you want to argue that any deprivation of property - even with reasonable compensation - is going to be forbidden by the treaty. If the former King of Greece can't get anything out of the treaty - even though all he got in return for the confiscating was a Hellenic finger, then all private landlords who are more reasonably compensated will get is probably an adverse costs award.

The hysteria on this thread only goes to show how far attitudes have shifted back to the bad old days of plutocrats and the indigent: the rich man in his castle, the poor man at his gate / God made them high and lowly and gave them their estate.

No one- as far as I can tell - is supporting State confiscation. No-one is saying that private landlords should be deprived of their property without consideration. It's a right to buy. In other words, it seeks a thoroughly market-orientated redistribution in order to achieve the Thatcherite goal of everyone having their bit of land. Most of us would like to believe that hard work pays off. In a genuinely equal society, it does. But if wealth is allowed to accumulate across generations into the hands of a small group of people, that stops. That group of people, by virtue of their money, end up controlling government, big business and the media, and if you think that's alarmist then look who's controlling it already.

It's completely sane. No one needs more than one house. Do you need to live in both?

This is not theft - it's redistribution to make sure everyone has a fair share.

Except it doesn’t ensure everyone has a fair share - that’s exactly the problem - it’s idealistic nonsense that wouldn’t even work

I still don’t for a second believe the intention is for the discount to be government funded as that would be complete and utter lunacy so what would happen is a number of people who had more than one property would be handing over chunks of their wealth to the most wealthy private renters as they’d be the only ones who could afford to buy

There’s nothing fair and equitable in that

But it also wouldn’t work for loads of practical reasons either

• landlords would ensure tenants didn’t qualify for the discount if it was time based
• there are plenty of wealthy people who rent out of choice - they could potentially buy, take the cash windfall and sell straight away
• there’s no way this should be funded by the tax payer if that is the intention as it only benefits a few people
• revenue from rental income taxation etc would be lost

The list is endless

@TomPinch it’s the right to buy at a discount. That’s confiscation.

If the state is to fund the discount how does giving out money to people who live in private rented accommodation reduce inequality when you will still need to get a mortgage and basically be able to afford to buy your house anyway? I used to rent in one part of the country while renting out my previous home in another part. Allowing me to buy my rental at a discount would mean I have two properties, hardly reducing inequality.

Also meant to add - what if the landlord had an interest only mortgage which was for more than the discounted price (assuming the discount isn’t government funded)?

The couldn’t afford to sell in that instance

Tenants rights would therefore depend on their landlords financial position which would never work either

As a (former) Labour voter these shit "policies" that Labour are floating are driving me mad. How about deterring BTL landlords by raising taxes a bit more, as the Tories did? How about improving the private rental market by extending tenancies and having rent controls like Berlin, for example?

No, McDonnell has to come up with crazy idea that alienate most voters - plus this policy is so full of holes that it's not clear that it would actually deliver the desired effects. It's the same for the forced share redistribution. How about incentivising instead of forcing?

It won’t work. Landlords will sell or leave the properties empty which will lead to a further housing crisis.

Making landlord sell under the value AND funding the discount from taxes (which they paid into too) is like holding someone's arm, hitting them with it and shouting why are you punching yourself imho.

@zsazsajuju your post isn’t accurate. Housing associations are private companies. Capital grants are no longer commonly used, however they were also claimed by the likes of Barrett homes, Barclay homes etc.

RTB is not the cause of the housing crisis. The cause of the housing crisis is lack for housing building for close to 50 years now. RTB was designed to replace old with new. But it doesn’t make nearly enough impact on today’s market to make up for the lack of house building from the entire sector. And the reason they are not building is complex.

Lack of government grant, complex planning permissions, planning permissions not being granted full stop, unattractive section 106 agreements, trades shortages etc etc. It’s simplistic to pretend tenants have just “bought all the properties” there are shortages in all housing markets, not just social rented.

They wouldn’t sell under value. I thought it had been established about 11 pages ago that RTB is sold at market value, with a discount for the buyer

A vote-winning ploy (they hope) that will IMO never happen.

Legislation would take ages to enact, and in the meantime plenty of LLs would evict tenants and sell - or list on AirBnB instead.

There are IMO far more constructive measure they could take as regards housing.
For a start, compulsory registration of ALL landlords, and sufficient powers/resources for councils to check and act on the many poor or rogue ones. Compulsory reg. would also help to ensure payment of tax on rental income - I am convinced that many currently get away without declaring it, or with under-declaring.
I say this as a LL myself.

They wouldn’t sell under value. I thought it had been established about 11 pages ago that RTB is sold at market value, with a discount for the buyer

No cherry it is only you who is working under the assumption that the discount is government funded - everyone else believes the landlord funds the discount, less CGT relief

Unless you can prove otherwise, it’s a bit pointless everyone discussing something only you believe to be the case

@Passthecherrycoke housing associations are effectively public bodies. They are not necessarily charities but they are not for profit organizations with tax and other benefits from that because they have an aim of providing affordable housing for their tenants. They are not private companies with shareholders. If you think that I’m afraid you don’t understand the sector.

RTB may have been designed to replace old with new but it didn’t. Hence why we have a massive shortage of housing (at least one of the reasons- the main one imo). Giving tenants a massive discount is one of the reasons why there is less public money to build housing as obviously public assets have then ended up in an individuals pocket (or their house to be more accurate which they can later sell). Hence less money to build houses and less income for public landlords.

Expecting a not for profit body that is funded by public money to sell its houses to its tenants at a discount is not right imo. But it’s not the same as asking private individuals or companies to sell theirs to their tenants at a discount.

Well. There is over 216 000 empty houses just in England. These are empty 6 months +.
Would be much better to start dealing with that rather than force landlords to sell.
And start should be with the reported 20 000 empty houses owned by councils.

RTB council housing is clearly sold at under market value. The money received for the sale of the property is less than the market value, sometimes up to £100k less. Cherry coke seems to think that if central government use public money to compensate housing associations or councils for this loss somehow that equals no loss. Which show the unfortunate lack of economic sense in some of the public sector.

The public purse is losing an asset at less than its market value. That money has to come from elsewhere in the treasury. The public as a whole is losing out.

There is over 216 000 empty houses just in England. These are empty 6 months +. Would be much better to start dealing with that rather than force landlords to sell. And start should be with the reported 20 000 empty houses owned by councils.

Also have to challenge why councils aren't using their powers to take control of the empty homes to bring them back into use.

If councils, who already have the power, are unable/unwilling to possess empty properties, you have to wonder how Labour's new proposals for compulsory purchase would work - there must be problems with the existing system if councils aren't doing it already with powers they already have!!

@Kazzyhoward absolutely.

I think England and Wales has over 11 000 homes which were empty for over 10 years. 10 years😮
Obviously no one wants these. I get why a property could be empty for couple of years. Bad situations happen. But 5+ is ridiculous.

I think England and Wales has over 11 000 homes which were empty for over 10 years.

I can well believe it. People are led to believe these long term "empties" are in run down areas, i.e. those pictures of entire streets in Liverpool and Newcastle that were derelict and ruinously expensive to convert to modern standards. But in reality, there's decent empty properties in "nice" areas too that would be easy to renovate.

We had one on our road, empty for 20 years - a large detached 4 bed house. When we first moved in, we didn't even notice it was empty, but as the years passed, it started to look more and more grotty, overgrown gardens, green moss/mould on the walls etc. Neighbours said it was an old woman who went into a home and refused to give permission to sell it as she was sure she'd return to live there again - the family hadn't got a POA so were powerless to force a sale. It was only once she died and her will went through probate that the family could sell it. It turned out the council had first dibs on the proceeds to pay her care home costs, but they had been happy to sit back and wait for her to die as they knew they'd get their cash eventually.

As more and more people are living longer and going into care homes, that kind of thing will also be getting more common. Councils need to step up and take the action by using the powers they have to force a sale - not just lazily wait for someone to die and someone else to go through probate so they can easily get their money in the end.

Zsa are you talking about council
Housing? Hosting association housing is sold at market value