Should councils sell off their best homes to build cheaper ones?

A think tank has suggested councils should sell off their most expensive homes and reinvest that cash into building cheaper ones.
Councils should flog off their most expensive homes and use that money to build cheaper ones. At least, that’s the latest idea from the think tank Policy Exchange.
According to Policy Exchange’s calculations, more than 20% of social properties are valued above the regional median, with a total value of £159 billion.
By selling the top end properties when they become vacant, councils would raise £4.5 billion each year which could be used to build as many as 170,000 social homes a year.
The definition of an ‘expensive’ property varies on a regional basis. So an expensive house in the south east will be more costly than one in the north west.
The idea has already won favour from the Government’s Housing Minister Grant Shapps. However critics have suggested it will lead to a form of social cleansing.
You can read the full report here.
What do you think? Is this a good idea? Or will it push poorer people out of more attractive streets, possibly creating ghettos?
More on property
HSBC pulls top five-year fixed rate mortgage deal
Post Office mortgage specialists can't give you advice
Offset mortgages won't save you money
The lessons I've learned since becoming a buy-to-let landlord
Most Recent
Comments
-
In the south-east (especially London) there's hundreds of millions of pounds of desperately-needed government (ie, public/taxpayers') money tied up in 'loss-making' state-owned housing, and a similar amount being spent on private renting by councils; meanwhile there's whole suburbs standing empty in the great cities of the north. This is not only a huge waste of money (twice over), it also adds to the north-south price and mind-set differentials, discourages home-ownership in both (for opposite reasons), causes class tensions between the jealous and frustrated poor and the overtaxed 'scroungerphobic' middle classes, etc. The solution is to sell off the valuable property but to ring fence the money for jobs, infractures etc in the northern relocations, so as not to create a 'failed state' dump for the non-contributing poor. clearly this would take time, which would enable a natural balance to establish - the north would still need doctors, just like the south would still need plumbers!
REPORT This comment has been reported. -
I am fortunate enough to live in a good area with good local schools . The ex council estate nearby is all owner occupied . This means you have to be pretty wealthy before you can send your child to one of these good state schools . My children could not afford to live here so my grand children will not be attending these schools. The policy of selling of affordable council housing divides families and makes a good state education - only for the chosen few. We only hear about the rough council estates and the problems they bring. There are plenty of good honest people in a variety of housing. Their children deserve the chance of a good education and the choices which are sadly too often only available to those with money.
REPORT This comment has been reported. -
For some time I've been banging on about supply and demnad and what keeps house prices at high levels - even if they're not quite at their peak just now. We need more housing in this country - otherwise housing will remain comparatively expensive. Whether its owned or rented doesn't particularly matter in my view, we need more of it. Rents are moving higher and higher because people cannot buy at the moment. This encourages those who have money to buy to let - but its all part of the same housing stock. So if a council property becomes vacant, it has a choice - it can let it again or it can sell it, providing a home to someone, or it can use the proceeds to fund the building of a new property built to modern energy efficient specifications to be let to another family. The latter route increases the housing stock by one the former method increases the housing stock by, er, nothing. Council and housing association letting is often at below market rates. This has the effect of making it likely that once a tennant is into a such a property, they are unlikely to move out. My own mother and MIL lived in their properties for 54 years and 61 years respectively, and continued to do so even when their economic situation was so much improved that they no longer needed social housing. Then of course there is the other factor that such housing is allocated according to need. Those who attempt to improve their housing situation within the private sector find that rather perversely they have decreased the likelyhood of obtaining social housing. Those who plead poverty, squallor and have multiple children at the drop of a hat appear to be rewarded. After WWII you were put on a list - eventually you got to the top of the list but in the meantime you got on with what you had. Nowadays many decent hard working people would never get to the top of the list. Yet the housing lists are massive - all because fundamentally the housing is of reasonable to good quality and its dirt cheap compared to the private sector comparator. And it'll stay cheap into the future no matter how your financial circumstances improve. I could cut housing waiting lists at a stroke - by substantially increasing rents. If the rents become burdensome, then the tennant claims housing benefit - that what happens in the private sector. And increasing rents would allow councils to improve their existing housing stock or to build new properties. Isn't that where I came in?
REPORT This comment has been reported.
Do you want to comment on this article? You need to be signed in for this feature
23 September 2012