Former tenants who bought their Greenwich Council homes since 2000 have made over £72 million in profit selling their homes on, it has been revealed today.
The figures have been unearthed as part of a major BBC investigation into the effects of Right to Buy, which was introduced by Margaret Thatcher’s government in 1980. Since then, more than 2.6 million tenants have bought their homes in Great Britain – and between 2000 and 2018, ex-tenants have made £6.2 billion in real terms by selling their properties.
Opponents say it has distorted the market and slashed the number of council homes available – but the Conservative government in England has kept the scheme, even extending it to housing association tenants in London. Governments in Scotland and Wales have abolished Right to Buy.
The investigation data has been shared by the BBC with 853 and other news outlets.
In Greenwich, 796 ex-council homes were sold in the 18 years after 2000, making an average profit of £90,490 each – or £53 profit for each day they owned their home. The total includes one buyer who sold their home at a £284,000 profit in 2007, just 70 days after buying it from the council; most ex-tenants hung onto their homes for just over six years.
853 put these figures to Greenwich Council, but did not get a response.
The picture in Lewisham is even more stark – between 2000 and 2018, ex-Lewisham Council tenants made a total of £194.7 million on selling ex-council homes they had bought under Right to Buy. There were 1,699 sales, with ex-tenants making an average profit or £114,644, or £59 per day.
In October 2005, one ex-Lewisham tenant sold their home the day after buying it from the council, at a £36,000 profit.
‘Shocking but not surprising’
Sydenham Labour councillor and London Assembly member Tom Copley told 853 that the figures were “shocking but sadly not surprising”.
“It is a simple inevitability of the policy that forces councils to sell their homes for up to £108,000 less than they are worth, to individuals who are then free to sell them on without discount in the future,” he said.
“Across London 42% of former council homes sold through the Right to Buy are now in the hands of private landlords, in Greenwich alone there are 200 individuals who own five or more former council properties. I wouldn’t begrudge anyone taking a decision in their own financial best interests, but it demonstrates that the legacy of the Right to Buy is a massive transfer of wealth from the many to the few.”
The figures are much lower in the two outer SE London boroughs, which transferred their homes to housing associations in the 1990s – ex-Bexley tenants made £848,000 in the 18 years after 2000 (20 sales with an average profit of £42,420; £32 profit per day), while former Bromley tenants collected £1.14m (12 sales with an average profit of £95,345; £89 profit per day).
Further west in Southwark, the total came to £354.7m (2,959 sales with an average profit of 119,888, or £64 per day.) Across London, the total is £3.1 billion, or £2.8 billion when inflation has been taken take into account.
‘Britain’s biggest privatisation’
The Chartered Institute of Housing told the BBC that the Right to Buy programme should be suspended in England.
“Effectively this has been Britain’s biggest privatisation and the fact that this money has never been properly reinvested in genuinely affordable homes for people in need is a huge missed opportunity,” it said.
The minister of state for housing, Kit Malthouse, told the BBC: “Under Right to Buy, the government has helped nearly two million people achieve their dream of home ownership and we are working hard to make sure that everyone in the country who wants it has a shot at getting on the housing ladder.
“Tenants who use Right to Buy must repay some of their discount back to their council if they sell the property within the first five years, and must offer their local authority the opportunity to buy it back.”
Story updated at 11am to amend a quote from Tom Copley.
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