Is the government proposal to allow Housing Association tenants the Right to Buy (The Telegraph, 21st Jan 2015), a sign that they are truly befuddled or simply considering ideas that makes populist headlines in a run up to an election, with little or no common sense behind them?
If, as politicians are always keen to remind us, we need to build more affordable homes then we need to stabilise the market. For homes to be affordable, demand and supply needs to equalise and we need a cure for the UK disease that Home Ownership is the only panacea to the housing crisis. Owning a residential property is about domestic investment strategy rather than merely a place to live and make a home.
If Housing Associations are forced to sell, then we will be removing a swathe of social housing from the system; it makes no sense to sell assets at below market value, to then try and replace them.
I imagine a number of CEOs of the larger Housing Associations are feeling a little nervous right now as many have become more ‘corporate’ in their business operations; the taking on of bank debt to fund larger schemes being one example. Is it right to assume those banks will be having ‘a few words’ if tenants have the right to buy at relatively large discounts to the actual value? Discounts which could stifle housing associations access to external funds and, subsequently, their development programmes of the future.