Recent news articles have highlighted the fact the Right to Buy properties are now costing some local councils up to four times as much in rent to private landlords as they were able to gain when the properties belonged to the council and they charged the rent.
It has been reported that nearly half of Westminster’s 22,000 council homes have been sold through Right to Buy over the past 30 years. Government rules do not allow local authorities to keep the sale proceeds of these properties, so these sold properties have not been replaced with more social housing. Many of the flats originally purchased under Rent to Buy have been bought up by private landlords and then rented out to tenants, many of whom are claiming benefits.
This has left some local councils with the situation where they are paying housing benefit to tenants who are renting ex-council properties from private landlords. This sometimes results in costs to the council of around four times the rent charged for a council home rented directly from the council. In some areas, this amount could even be up to five or six times the council rent.
What a mess, but can it be avoided? Probably not as rentals from private landlords are a big portion of the rental sector throughout the UK, which is good news for landlords, perhaps not such good news for local councils.
Looking for a property to rent? Check out current properties available on the Private Landlord Directory.com website.