Confused Thinking Of The Day

From this afternoon's Evening Standard:

Young professionals struggling to get on the property ladder are being offered knock-down rents in some of London's most sought after neighbourhoods...

In a groundbreaking £7 million scheme, Westminster council is targeting those who earn up to £30,000 a year but cannot put money aside for a deposit to buy a house because rents are so high. Tenants who sign up will pay heavily subsidised rents — up to 67 per cent off the market value. They will be expected to put aside the money they save for a deposit...

The council is buying 30 properties for the trial: tenants will be charged rents as low as £120 a week for period homes in areas such as Bayswater, Pimlico, Marylebone and Westbourne Park. That is less than a third of the £365 average market rent for one-bedroom flats in these areas...

All the flats involved in the trial are former council properties that Westminster is in the process of buying back from leaseholders for an average £230,000. The council is funding the project itself, but a spokesman said it was "negotiating" a grant from the Homes and Community Agency.

Philippa Roe, Westminster's cabinet member for housing, said ... she was "not too worried" if some tenants decided not to save while they lived in the flats, or spent their bonus payments on something other than a home. "It will help with our housing shortage anyway," she insisted.

Can anybody explain to me how any of this is supposed to make any sense?

1. This makes a mockery of the whole "right to buy" idea, which was Home-Owner-Ism taken to extremes. Westminster Council sold these flats off at undervalue over the years, and now they're buying them back for full market value (or probably slightly above), at a net loss of around £200,000 to the taxpayer, also known as "privatising gains, socialising losses".

2. In an ideal world, they would never have sold it off in the first place, and increased the rents in the more desirable areas to market value, and used the money to build more social housing a bit further out of town.

3. What's done is done, so Plan B must be to use that £7 million to build a hundred new flats a bit further out of town. Sure, rich people will end up in the nice areas and poor people in the not-so-nice areas, but that's the whole point of being rich, isn't it?

4. She does not appear to have given any thought on how to prevent people sub-letting and pocketing a huge profit at zero commercial risk. If they are really hell-bent on buying them, would it not be better to let them out for market value and spend the money on building some new flats?

5. But the crowning piece of nonsense, IMHO, is the idea that buying an already existing flat "will help with the housing shortage". There is no net increase in the number of flats. And if a higher income household can't buy this flat, then they will buy another one nearby and push up prices even further, surely?