Right to Buy and Help to Buy boom are only “short term solutions”
Right to Buy and Help to Buy are showing signs of success but affordable housing is suffering, according to new data from the Department for Communities and Local Government.
November 21, 2013
Supply of affordable housing is down 26% compared to 2011 to 2012, whereas Right to Buy sales in the second quarter were almost three times those in 2012-13 and the amount of properties bought under phase one of Help to Buy reached 5,375 in its first six months.
Paula Higgins CEO of the HomeOwners Alliance said she welcomed schemes that aimed to increase homeownership but warned that care should be taken to ensure a sustainable approach to resolving the housing crisis.
“Schemes like Help to buy are definitely helping to fuel demand but the real issue is supply and the UK hasn’t been building enough for 30 years.
“We’re glad to see the schemes working but they are only short-term solutions and we need an exit strategy. Like taking preventative medicine – it’s not the cure; we need to plan a way out and make sure we don’t come to rely on these short-term solutions.
“Right to Buy is one way of allowing people to own their homes and we support it in cases where it supports people’s right to do that. But all investment must be recycled back into new housing.
“Without increasing new housing all of these schemes are just papering over the cracks without doing anything to solve the long term problems.”
Higgins welcomed the news that most home purchases in the Help to Buy equity loan scheme were made by first time buyers, accounting for 4,948 (92%) of total purchases.
But she said there was still a of first time buyers being pushed out by demand from wealthy foreign investors and loopholes that make it easier for foreign buyers to borrow.
“We know that 75% of developments sold in London are going towards overseas investors. And estate agents prefer dealing with wealthy, cash-buyers meaning that first time buyers don’t get a look in.
“While the HomeOwners Alliance doesn’t have a problem with anyone who wants to buy a home the government needs to make a priority of allowing of people to buy their first homes.”