Friday, 26 June 2015

Jeremy Corbyn on top form

Spotted by Random in The Independent:

The ‘Right To Buy’ policy that lets council tenants buy their homes at a big discount should be extended to the tenants of private landlords, a Labour leadership contender has said.

Jeremy Corbyn said Labour needed to go further in tackling the housing crisis and that extending Right To Buy could help more people find a secure place to live.

“We know that Generation Rent faces an uphill struggle simply to get into long-term housing. We have seen some good ideas from Labour to establish more secure tenancies for renters. Now we need to go further and think of new ways to get more people into secure housing,” he said.

“So why not go with Right to Buy, with the same discounts as offered by way of subsidised mortgage rates [this sentence is not entirely clear], but for private tenants and funded by withdrawing the £14 billion tax allowances currently given to Buy to Let landlords? I believe this idea could open up the possibility of real secure housing for many currently faced with insecurity and high rents.”

I attended a talk by Lib Dem leadership candidate Tim Farron recently. He said he opposed Right to Buy. I pointed out that he was on the back foot with that one ("You are preventing millions from achieving the aspiration of home-ownership" etc), so why didn't he change tack and say it was a brilliant idea, so brilliant in fact that he would extend it to private tenants. I actually got a laugh and a round of applause for that.

Unsurprisingly, he did not answer the question, thank God that Corbyn has picked up the slack.


Rich Tee said...

The trouble is that Corbyn is regarded as loony left and only has an outside chance, although this is a good idea as far as I'm concerned.

The problem is also that there would be a time limit on it, like five years, and in the current climate a landlord would just wait for 4.5 years and then give the tenant two months notice to leave so they could get somebody else in before they're forced to sell it. There would have to be some reform of the Assured Shorthold Tenancy at the same time.

Mark Wadsworth said...

RT, in that case, don't have time limit. The discount should be based on the number of years the landlord has owned it and not how long the current tenant has been there.

mombers said...

I hope the HA confiscation has no chance in hell of passing the courts, where the housing associations will ask the judiciary to uphold their private property rights. But it does bring up the obvious extension of this policy to all renters. Why expropriate the best quality rented housing and give it to the PRS (with a short tenure as owner occupied during the no-sell period)?

Rich Tee said...

MW, landlords won't let property if there is uncertainty that they will be forced to sell it at any time.

Although if that has the effect of causing landlords to sell up and invest their money elsewhere maybe that is no bad thing.

Bayard said...

MW, I do think that RTB ought to be restricted to landlords who are in receipt of housing benefit and that the discount ought to be based on how long the landlord has been in receipt of HB (cumulative, so that a break does not "reset the clock").

RT, I think that is the idea.

However, as I have always maintained, capping housing benefit at the level of rents paid for social housing would be the best way of tackling the huge amount spent on HB. Although I am against more regulation, some sort of minimum standards should also be enforced for housing where the tenant is in receipt of housing benefit.

Nothing will happen while the Tories are in power as urban rentiers are the backbone of the Tory party, which is presumably why the whole HA RTB issue has been brought in in the first place.

Mark Wadsworth said...

RT: "if that has the effect of causing landlords to sell up and invest their money elsewhere…"

That's the general idea :-)

B, "RTB ought to be restricted to landlords who are in receipt of housing benefit"

Fair enough, but that seems a bit wimpy.

Housing Benefit is an actual cash benefit, which can come off the price.

But house price inflation is a non-cash benefit of equal value that can also come off the price.

i.e. landlords can reasonably be expected to sell their houses for what they paid for them, minus any HB received. I'll be generous and let them keep the actual rent.

Bayard said...

"I'll be generous and let them keep the actual rent."

But what if all the rent has been paid as housing benefit?

Mark Wadsworth said...

B, selling price is purchase price minus HB received.