Ex-Southwark Council tenants make £350m in Right to Buy profits since 2000, analysis finds

Josh Salisbury (14 March, 2019) Housing

Nearly 3,000 homes that were purchased from the council were sold on for an average profit of £120,000, the analysis reveals

28240Photo credit: Marcbela

Former Southwark council tenants who bought their homes under right-to-buy have made a staggering £350million in profit since 2000, data published today reveals.

The FOI and Land Registry data was unearthed as part of an investigation into Right to Buy by the BBC, and has been shared with local outlets such as the News.

It reveals that 2,959 Southwark homes which were originally purchased under Right to Buy were then sold on by their owners between the year 2000 and April 2018.

Each sale made an average profit of nearly £120,000 – an average profit of £64 for every day of owning the home.

According to the data two Southwark tenants who bought their homes under Right to Buy, the flagship policy introduced by Margaret Thatcher, sold them on just seven days later.

Most stayed in their homes for nearly seven years before selling it on. Nationally, £6.4bn of profit has been made.

The scheme helps eligible council tenants in England to buy their home with a discount of up to £108,000 in London.

Tenants selling with the first five years must repay part of the discount back to the council, and if sold within the first ten years local authorities must be given a first right-of-refusal on the sale.

Southwark Council has lobbied for a number of changes to the policy to mitigate the loss of council homes in the borough.

As the News has reported, council bosses have pushed for the government to allow a ‘one in, one out’ policy for Right to Buy applications – capping the number of purchases based on the number of new homes built – and possible legal convenants to require any future sub-letting to be at a social rent.

Speaking to the paper in November, Cllr Leo Pollak, cabinet member for social regeneration, great estates and new council homes, said: “While we don’t begrudge any individual tenant exercising their right to buy, with over 25,000 people on the housing register we have been looking into ways of mitigating the impact of right to buy in the borough.

“We have a responsibility to maintain the existing stock of council homes at council rents in the borough, which is why we’re looking to advance two ideas for better maintaining the overall stock of social homes.”

It was further extended as part of a Conservative party pledge at the 2015 election to also include housing association tenants, a move that was criticised by housing campaigners.

In January, the News reported that the council had spent around £2million renting back former council homes sold under the policy for use as temporary accommodation.

More than 1,300 Southwark homes have moved into private hands since 2012, when the discount was deepened by the Coalition government.

Right to Buy has been scrapped in Scotland and Wales.

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