Policy Exchange: half right. Grant Shapps: reliably wrong.

Spotted by Lola in The Telegraph:

In the South East, almost 100,000 council homes are worth more than the average privately-owned property, according to Policy Exchange.

The think tank estimated that selling social housing in expensive areas could raise at least £4.5 billion a year. The proceeds could be used to build houses in cheaper areas to tackle Britain’s housing shortage as part of the biggest building programme for decades.

Yippee, hooray, for more social housing. The problem is that councils will be much better at the 'selling off' bit and not so good at the 'building more social housing' bit.

Here are the numbers:

The Policy Exchange report found that almost four million houses and flats are let out to social tenants in England. However, 22 per cent are worth more than comparable houses in the same area — a total of 818,000 properties throughout the country.

Up to £159  billion could be raised in total if all social and council housing worth more than similar-sized properties nearby were sold across the country, the report suggested.

The think tank said properties should be sold off gradually, as they became vacant. At average vacancy rates that would enable the Government to sell 28,500 homes a year to private buyers, raising £4.5 billion a year, when debts have been paid down.

That could then pay for between 80,000 and 170,000 new social houses to be built a year, creating up to 340,000 jobs, the report argues.

£159 billion ÷ 818,000 = £194,000 each, seems about right.
£4.5 billion ÷ 80,000 = £56,000, seems about right (that's the build cost of a modest house/flat excl. land). Using 170,000 gives us £26,000 which seems on the unrealistically low side.

However, if £4.5 billion is our target figure which we want to raise from social housing in more desirable areas, the other approach would be to bump up the rents on those 818,000 homes by about £105 a week on average (this primarily affects central London and parts of the south east, which would solve the sub-letting issue to a large extent).
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Our Housing Minister responded thusly:

Mr Shapps said he was keen to study the report in detail and urged councils to consider following the key recommendation to sell their most valuable properties.

“It clearly makes sense to use housing stock as efficiently as possible,” he said. “Where you have houses which are worth millions, you could sell them and build a lot more homes to help sometimes ­vulnerable people come off the ­waiting list.

“It is blindingly obvious. And only a perverse kind of Left-wing dogma that appears indifferent to the suffering of those languishing on record waiting lists prevents this kind of common sense from prevailing.”

Fascinating. He supports the idea of selling off council housing for top whack. Funny that, it doesn't seem like five minutes ago that he supported selling it off for massive discounts:

The revamped Right to Buy, which will give 2.5 million social tenants the opportunity to buy their home with discounts of up to £75,000 was launched last month.

Mr Shapps has said his ambition is that, for the first time, every extra Right to Buy home sold will be replaced by a new affordable home to rent nationally. He said he had listened to views raised by councils on how they would deliver this ambition, and has agreed to extend their timeframe for spending the receipts from two years to three.

Ho hum. If you can build a new home for £56,000 and he's offering discounts of up to £75,000, doesn't that mean one-and-a-half fewer new homes for each old one sold?