Rural communities and the right to buy

The sale of housing association homes to their tenants has been in the news. The Government is very proud of its deal with the National Housing Federation (NHF); Labour is very cross. But the impact on rural communities has received too little attention. 

I made the case for a rural exemption in a blog in July. Social housing is crucial to the vitality of the countryside. Rural areas have proportionally less affordable housing than urban areas (many villages lost most of their social housing when council housing was sold off and not replaced); house prices are higher; wages are lower; and the gap between average wages and average house prices is growing faster. In addition, it takes longer and costs more to build social housing in villages than in cities and large towns.

Everyone seems to agree that some affordable rural housing should be exempt from the right to buy. Brandon Lewis, the housing and planning minister, tweeted me on 8 October to say ‘rural exemptions already apply & will continue’. The deal constructed by the NHF and the Government promises that housing associations can ‘exercise discretion’ over the sale of properties in certain rural areas. The message from government seems to be: don’t worry, trust us.

But the proposed exemptions for rural areas are inadequate.

  1. The definition of ‘rural’ used in the deal fails to protect affordable housing except in Areas of Outstanding Natural Beauty or National Parks, or in places previously designated as rural by the Secretary of State. It covers only 21% of rural parish and town councils with a population of under 5,000.
  2. Affordable homes in villages are generally built on ‘rural exception sites’, land gifted by philanthropic landowners or sold at a discount. While the Government-NHF deal states that housing associations do not have to sell properties with ‘clear restrictive covenants’, it does not explicitly protect all current or future affordable housing on rural exception sites.  Without this clear protection, it is likely that some affordable housing on rural exception sites will be eligible for purchase. Any poorly worded covenants will be open to legal challenge.
  3. If rural exception sites are not exempted from the right to buy, landowners will not provide suitable land in future, further limiting the supply of affordable rural housing. Rather than genuinely affordable rental housing, the Government’s Rural Productivity Plan set out plans to build ‘starter homes’ on rural exception sites. One can debate the merits of starter homes, but at 80% of market prices they are likely to be unaffordable even to rural residents on median incomes, and they can be sold on the open market after five years.
  4. When questioned about the replacement of homes in rural areas that are sold under the right to buy, Brandon Lewis said that ‘for every home sold an extra home will be built in that area’. But this underestimates the difficulty of providing affordable rural housing. Previous schemes in rural areas that allowed the sale of affordable housing with the promise of one-to-one replacement have failed, with eight homes sold for each one replaced. In rural areas, suitable land is harder to come by, construction costs are higher and there are far fewer organisations that have the expertise to deliver new homes. So it is likely that any replacement housing ‘in the area’ will be delivered in towns where development land is more readily available, not in the villages where the housing association properties are sold off. The Minister’s statement also goes further than the wording of the  Government-NHF deal, which says only that ‘at a national level, associations would deliver replacement of at least one new home for each home sold’. Is the replacement national or ‘in the area’? And if the latter, what does that mean?

All in all it seems inevitable, as things stand, that many villages will lose the few affordable homes they have. They will finally become the preserve of relatively well-off incomers.

Does this matter? One senior Tory told me that no one has a right to live in a village any more than they have a right to live in Mayfair. Someone may have grown up in a village and work in it, but if they cannot afford to buy a house in it they should move to the nearest affordable town. That is at least honest, and it already reflects the reality for many people, given the scarcity of affordable housing in villages. But it is not what the Government says it intends by this policy.

If the Government wants to protect rural affordable housing, it must implement a full rural exemption from the right to buy. This means exempting:

  • all affordable housing in National Parks and Areas of Outstanding Natural Beauty;
  • all affordable housing delivered on rural exception sites or by Community Land Trusts or similar community led organisations;
  • all affordable housing in rural communities with under 3,000 population as at the 2011 Census;
  • all affordable housing in rural communities with under 10,000 population as at 2011 Census as designated by the Secretary of State, taking into account the proportion of second homes and holiday homes, the disparity between lower quartile average earnings and lower quartile house prices, and the extent to which the community operates as a rural ‘hub’ for surrounding settlements.

In these rural areas, local authorities should not be able to sell vacant homes to fund ‘Right to Buy’ discounts or replacement homes elsewhere.

The Government has gone rather silent on the details of the policy. CPRE, along with partners in the Rural Coalition and rural housing associations such as Hastoe, will carry on pressing it for a proper rural exemption. It would be good to get a response from the Government, better still to get a positive response.

9 Responses to “Rural communities and the right to buy”


  1. 1 Andrew Carey October 15, 2015 at 9:13 pm

    Agriculture is an industry in case you hadn’t noticed, and one that dominates the land area of Great Britain. So what you are really advocating is an industrial exemption from right to buy, not a rural one, as very little of Great Britain is actually rural in the old-fashioned sense of the word, and especially not in the areas you are thinking about. Much of the rest is post-industrial e.g. the old lead mining areas in the Yorkshire Dales.

    I really wish someone would take your farm subsidies, your inheritance tax exemptions, your cheap diesel and your exemption from business rates and stick the whole lot up where the sun doesn’t shine. This special pleading for your subsidised friend disgusts me.

  2. 2 Arthur Franks October 16, 2015 at 7:27 am

    While ever we have ‘right to buy’ without houses being built to replace, we will have a housing problem. There is no where near enough accommodation on the market with long term affordable tenancies or to buy at prices that are not inflated by people buying to let and then letting them at price that gets the mortgage paid and gives a nice profit as well.

  3. 3 CPRE Local Supporter October 29, 2015 at 1:11 am

    The National Housing Federation seems to have caved in about the general principle of selling housing association housing to sitting tenants without much of a fight. Yet there was general public opposition to the plan and a number of Conservative MPs were against it. A tougher approach might have led to the Government losing the legislation, or having to change it, because it has such a small overall majority. The NHF’s principal members have some explaining to do.
    If the general right to buy is to be implemented, however, the position in rural areas is different, and is not adequately set out in the discussion above.The Minister’s statement (apparently a tweet) that “rural exemptions already apply & will continue” is glossed over as unimportant, when it is actually the key to the Government’s intention – or appears to be.
    The Housing Act 1980 introduced the right to buy council houses (not originally flats) and it also included the power to restrict the resale of council houses in ‘designated rural areas’. This power now lies in the Housing Act 1985. The restrictions are applied not to a sale but on the right of re-sell an ex-council house except to a person who has lived in the same ‘designated region’ for the previous three years (usually defined as the District Council’s area). The control is actually by covenant, which perhaps means that its significance is not appreciated by planners. It is called a Rural Area Covenant or a S.157 Restriction. The local housing authority (the District Council) is the party that controls its application in any particular sale.
    These restrictions are imposed by Statutory Instruments and a large number of rural areas outside AONBs and National Parks are covered by them. The Labour Government under John Prescott was quite active in issuing these restrictions, which are permanent. Some cover surprisingly large areas, not far from major cities.
    It would appear that the DCLG’s intention is to apply these covenant controls to housing association dwellings sold under the new right to buy, in all Designated Rural Areas that exist now.
    It appears (from the article above) that CPRE does not understand the terrms of the 1985 Act or the continuing role of S157 Restrictions. However, CPRE is in a good position to assemble a complete map of where they apply (not simple, because of the many different S.I.s). It could then set out what improvement it seeks for controls on re-sale of housing association dwellings, over and above the controls that exist on former Council Houses in rural areas.
    If housing associations are also going to be able to refuse to sell its rural rented dwellings at all, as appears to be the case from the quotes above, that is better than just applying Rural Area Covenants. But it should be additional to applying them.

  4. 4 Luke Burroughs (Policy and Research Adviser at CPRE) October 29, 2015 at 11:08 am

    Dear CPRE local supporter,

    Thank you for your very detailed comment.

    I agree with you that the NHF could have taken a tougher line on extending the Right to Buy.

    However, I disagree that we have ‘glossed over’ the minister’s tweet that says ‘rural exemptions already apply & will continue”.

    As you rightly point out, there are no ‘exemptions’ to the scheme in rural areas, only very weak ‘restrictions’ that control who a property can be sold on to after it has already been purchased for a discount. These restrictions do nothing to prevent the loss of rare and valuable rural affordable housing to the open market, and it therefore begs the question why the minister used the word ‘exemptions’ when there do not seem to be any.

    You are also correct in stating that these weak restrictions only apply in ‘designated rural areas’. As we identify above, the coverage of these areas designated as ‘rural’ by the Secretary of State outside of AONBs and National Parks is patchy. Research suggests that its coverage could be low as 21% of rural parish and town councils with a population of under 5,000. However, I agree that mapping these areas and assessing the level of coverage properly would be very helpful, and is something that I will suggest that CPRE works on in the near future.

    Further to this, there seem to be no transparent criteria published by Government that allow parishes to assess whether they qualify as ‘rural’ in the eyes of Government. Instead, they must write to the Secretary of State. It might be helpful for the Government to clarify these criteria, so a greater number of rural parishes can qualify.

    CPRE believes that the supply of rural affordable housing is so low, and the need for this housing in rural communities so great, that the strong exemptions (not restrictions) identified above for ALL rural areas must be implemented in order for the countryside to thrive socially and economically.

    Thanks again,

    Luke Burroughs

  5. 5 CPRE Local Supporter November 9, 2015 at 2:06 pm

    Comment back to Luke Burroughs CPRE Housing Policy & Research Adviser
    There are two different issues here – what has happened to housing policy nationally, and the position in rural areas.
    (1) At the national level, the National Housing Federation in 2014 developed a plan to greatly expand the affordable housing sector (they meant rented housing, essentially). This was called ‘Homes for Britain’ and the initiative was discussed well by Anthony Hilton, City Editor of the ‘Evening Standard’, in December 2014: see http://www.standard.co.uk/business/markets/anthony-hilton-finally-a-solution-to-our-housing-crisis-is-beckoning-9784036.html
    Hilton wrote: “It is the ambition of the National Housing Federation and almost 100 other associations, housing charities and lobbying groups in a coalition called Homes for Britain to push it a lot further up the agenda between now and next May. It seeks to force the political parties to pledge to end Britain’s housing crisis within a generation and to publish within a year of gaining office a detailed plan of how they would achieve this.”
    He called it “a remarkable visionary document” and summarised it thus: “Their ambition for 20 years’ time is to build 120,000 a year, a threefold increase — at which point, they think, one in four of the population will live in one of their houses”.
    But nothing seemed to be said about the NHF plan during the election, and the Government now seems to be turning its back on the concept entirely. If so there is no discussion and the NHF has fallen silent about it. What happened? It was praised by a City Editor so Conservatives might have supported it – but Tory MPs haven’t been pressed to.

    (2) In the rural housing sector, the pressure should be, as stated in the main blog above (15 October) to protect rural housing association stock. Much of this is former District Council owned houses, as most Districts transferred property in this way under past Housing Acts.
    However, the rural local authority housing which has been sold since the 1980s is also important, where its sale took place in Designated Rural Areas under S.157 Restrictions. As stated above, this is control of ownership through Rural Area Covenants. Had Brandon Lewis tweeted that ‘rural restrictions on re-sale that apply now to former council houses will apply to housing association houses that are sold’, and not used the erroneous term ‘rural exemptions’, he would have been correct, as it seems to be the intended new policy.
    What Rural Area Covenants do is to create a different housing market. They control to whom a property can be sold after it has already been purchased for a discount. Contrary to the assertion above, these restrictions do “prevent the loss of rare and valuable rural affordable housing to the open market” – that is their purpose. But it appears that because this is an ‘under the radar’ aspect of housing, it attracts little attention. It has not been examined or discussed in what CPRE has published or stated about rural housing policy.
    The extent of Designated Rural Areas should be clear from mapping all the localities listed in the many Statutory Instruments which have been issued and confirmed by Parliament. There should not need to be any special CPRE research to produce a national map as the LGA, Welsh LGA and COSLA ought to keep the details (or their housing experts should). It is evident from a look at some S I s that John Prescott was keen to use the powers to designate and did so. Thus the Labour Governments of 1997-2010 considered the use of S157 Restrictions worthwhile.
    The covenant controls are permanent and there is no appeal by an owner against a District Council’s decision on whether the prospective purchaser complies with the restrictions. So they are potentially quite strong. However, there are no accessible statistics (by County or region) on how many sales take place, how many are rejected by the covenant holder, and by how much the price is lower than the prevailing open-market conditions for the area. The NHF and LGAs may have a picture.
    In principle the Rural Area Restrictions should be a policy which Conservatives can support, as they allow private ownership but hold down the market price: buyers are likely to be Conservative voters. On the other hand the pure-free-marketeers will dislike them. Something similar exists in the mountain districts of some Swiss cantons, to prevent sales of property to foreigners. But then the Swiss are both practical and have a lot of local democracy which, unlike in the UK, central government cannot overrule. What does seem clear is that the powers in the 1985 Housing Act are there, are used, and are going to be extended to housing association housing that is sold.

  6. 6 bockerduke February 9, 2016 at 11:58 am

    Hi

    As a tenant with a housing assocation I am getting really fed up with this rural exemption talk. My family and myself have lived in dorset for generations and could now be priced out. You seem to fail to grasp that people like myself and my partner who work full time jobs while raising a family are going to be priced out with market rents as our combined income is just over 30k a year under this bill. If we had the right to buy we could stay in the home we have had for 15 years. Why is this? Well a mortage would be the same as our rent as it is now, however market rent would be an extra £300 per month.
    So what about the lower income familes and familes on benefits?! Well it doesn’t effect them does it? They will carry on with the same rent levels they have now as they don’t earn over 30k a year.
    So to sum up what you are asking for is less diversity. In my village what would be left is the well off families (most of which are retired people relocated from the southeast) and the less well off, no middle bracket.
    There are 30 assocation houses here, all of which were built for farm labours in the 1940s. Farm labours are not needed in the numbers they once were. So other local people have moved in to the houses. Most of those households work, only 5 houses holds that we know are on benefits. The wages around here are not high, so 24 other families facing simliar issues as my own.
    Now you may argue why should my family get a discount, and I really can’t argue that point. But I will say the house I live in is my home and I have put my own money into it to keep it maintained over the years, this includes stripping the walls back to brick to re render as all the walls were falling apart. And rebuilding a chimney breast at the point of collaspe as the housing assocation would let it fall down before they would do any repairs, so please do not think it is some idealistic 18th century romantic country cottage, its a two bedroom semi.
    Now if a clause was put in that I could only sell my home to other local people if I ever wanted to move, I would gladly except that as I am sure others would.
    But to have rural areas exempt from right to buy will not save rural communities. It has been my experience that housing assocations are only concerned with money and not homes and do not keep their housing stock in good condition, that is certainly the case here.
    I just cannot see your point of view, so what am I missing? Is your view on this from personal experience on rural life or just a romantic view?

    • 7 sspiers February 9, 2016 at 10:12 pm

      Thanks for the comment, which is very thought provoking.

      ‘Pay to stay’ certainly makes it more likely that households earning more than £30,000 will want to use the right to buy – which is perhaps the intention. And no, we don’t want villages just for the well off and those dependent on benefits – we want a social mix.

      I can quite understand if 25 families in your village want to buy their housing association properties. It sounds like an entirely rational decision, not only because you will get a subsidised property, but because a mortgage will be cheaper than your rent and because your housing association has not been a good landlord.

      But if 25 of the 30 affordable homes in the village cease to be affordable and become market homes, that will be another Dorset village with hardly any houses within reach of those even on medium incomes.

      Building more market homes or even starter homes (up to a cost of £250,000 and available to sell on the open market) will not change that: they will still be out of reach of most people in most Dorset villages. Only building social housing that is affordable in perpetuity will help, and that has always been difficult and now seems to be quite unlikely.

      So while I understand your perspective, I hope you understand those of us who are arguing for a rural exemption from the right to buy. We wouldn’t have started from here.

  7. 8 Jennie March 27, 2017 at 1:40 pm

    There is another view: my partner and I are both key workers and we live in a housing association property in a rural location. We are unable to buy our property due to the rural exemption. We feel that we are being penalised for living in our property. Our housing association has committed itself to bring social housing rents in line with private sector housing so while our rent continues to rise year on year we are denied the opportunity to own our property. We have lived here for 12 years and we do not want to move, we both work as key workers and we have 4 children.

    • 9 sspiers March 27, 2017 at 5:00 pm

      Thank you for your comment. I sympathise with your position. As I said in response to a previous posting, ‘we wouldn’t have started from here’…


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