Hackney Council has hit on an innovative way of stopping millions of pounds of Right to Buy cash being snatched by the government – it’s going to give it away.
Housing associations have been invited to bid for £16m the town hall has in its back pocket but cannot spend – so long as they use the cash to ease the council’s 12,000-plus waiting list.
A bizarre rule gives councils just three years to spend the money they receive when someone buys their council home, or they must hand it over with interest.
What’s more, only 30 per cent of any new development can be funded with the Right to Buy money – so the dough can only be used when cash comes in from elsewhere too. And they can’t spend it on anything apart from housing.
Hackney is the 11th most deprived borough in the country, but gentrification means it also has some of the highest house prices.
The council has so far managed to plough all £45m of its receipts back into its huge estate regeneration, building 3,000 homes, but is now running out of ways to spend it before the three-year cut off.
Mayor Phil Glanville told the Gazette: “We’re always looking at new and innovative ways of delivering more affordable housing in the borough. Housing associations are suffering too.
“Homes are badly needed. we’ve sold around 200 through Right to Buy each year since 2012 and though the model is one-for-one, all the restrictions on funding to replace them are hard to meet.
“We’ve seen the receipts return to government in other boroughs and that’s the last thing we want to do.”
Hackney sold 213 of its homes through Right to Buy in 2015/16 and from April 2016 to January this year sold another 120.
Mr Glanville said he was “really keen” to see the money from the Mayor’s Housing Challenge used solely for social homes or “genuinely affordable housing”, which could mean Sadiq Khan’s new London Living Rent – averaged at one third of a household’s salary.
Regarding where they could be built, he said: “We are very clear we don’t want to build on green space. We are consulting on building on car parks, garages and depots and it’s proved quite popular.”
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