The mayor of London Boris Johnson has raised concerns about his party’s proposal to extend the right-to-buy to housing association tenants and the impact that may have on councils.
Mr Johnson said he would not want to see councils “deprived at a rapid rate of their housing stock” if more homes were not also being built to replace them.
The Conservative manifesto said a Tory government would require local authorities to sell their most expensive properties as they become vacant, which the party estimated would raise £4.5bn per year, to pay for a new right-to-buy for housing association tenants.
The policy has been met with widespread opposition with even leading Conservative councillors publicly expressing concern about the proposal in the run-up to the general election.
During London mayor’s question time on Thursday, Mr Johnson, who is also a member of the government’s cabinet, told assembly members: “It is certainly true there are some homes owned by councils that, if sold, would help to deliver more homes – the efficient management of housing stock is something everybody would want to see. But I wouldn’t want to see councils in London deprived at a rapid rate of their housing stock which is one of their fundamental assets.
“Nor, symmetrically, would I want to see housing associations deprived too rapidly of their homes which are fundamental to their credit worthiness and their ability to borrow and to build more homes. As we help people to buy and live in their own homes it’s very important this policy delivers more homes.”
A survey by the Local Government Association, Chartered Institute of Housing, and the National Federation of ALMOs found only half or fewer of homes sold under the existing right-to-buy for council homes had been replaced.
Mr Johnson, who was elected MP for Uxbridge and South Ruislip at the general election, has been granted a place at prime minister David Cameron’s political cabinet but does not have any minsterial responsibilities. He said he wanted money raised from council house sales in London to remain in the capital.
“To make this policy work it has to deliver more homes,” he said. “It would be the height of insanity to use the proceeds of council homes sales in London to help build more homes outside [of London] because it’s in London where we have a housing crisis.”
He added: “This policy is, I think it is fair to say, at an early stage of elaboration. There is a way to go on this.”
When later asked if he would commission his officers to assess the impact of the extension of the right-to-buy policy, Mr Johnson said it would be “utter nonsense” to do that as the policy was “still a paragraph in a manifesto” that had yet to be fully worked out.
Mr Johnson acknowledged concerns raised by ratings agencies that it would have a negative impact on housing associations’ ability to borrow and capacity to build more homes “if they are not reimbursed”.
He added: “I’m certain some housing associations will want to test those points in court.”