Affordable rural homes ‘could dry up’ under Right to Buy, landowners warn

Right to Buy may threaten rural housing developments, the CLA has warned.

Right to Buy may threaten rural housing developments, the CLA has warned. - Credit: Archant

Landowners’ leaders have warned that affordable rural homes developments could “dry up” under the Government’s new Right to Buy policy.

The Country Land and Business Association (CLA) has warned that if the Housing and Planning Bill goes ahead in its present form, the rural housing crisis could get worse as landowners decide against building affordable rural homes for rent for fear of them being sold off as part of Right to Buy.

It is calling on the Government to offer an exemption to the scheme in rural areas.

It cites a new report from the Royal Institute of Chartered Surveyors (RICS), which found a 76% shortfall in rural affordable housing with the average cost of a house in some countryside communities 11 times greater than average annual wages.

The Institute’s Rural Policy Paper called on rural estate owners to work with local authorities to create more affordable new homes, but the CLA says landowners, who were already bringing forward land at considerable under-value, are likely to be put off by the new Housing and Planning Bill.

CLA East regional director Ben Underwood said the lack of homes in the countryside was “extremely worrying”.

“The situation in some areas is already critical,” he said.

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“Many rural landowners have made a considerable investment in their community by offering land to housing associations at below market values for the development of affordable properties for local people in housing need, but policies proposed in the new Housing and Planning Bill could see this supply dry up.

“Extending Right to Buy to housing association tenants in rural areas will reduce the already small number of affordable properties that are already available.

“There is no doubt that this will also result in landowners being very reluctant to continue making this offer, if those homes are then going to be sold off on the open market and no longer available for rent.”

The inclusion of starter homes on Rural Exception Sites would act as a significant disincentive for landowners, he added.

“Although starter homes are classed by the Government as ‘affordable housing’ they can be sold after five years at full market rate so it is questionable why a landowner would donate land or release it at a lower price.”

Mr Underwood suggested that in order to prevent the scheme from hitting housing provision in the countryside, there should be an exemption built-in for rural communities.

“Settlements of 10,000 or less should have the opportunity to be exempt from Right to Buy, while those with a population of less than 3,000 should have an automatic exemption,” he said.

A Department for Communities and Local Government spokesman said: “We want to ensure anyone who aspires to own their own home has the opportunity to do so and have already seen the number of new homes increase by 25% in the last year alone.

“Proposals to extend Right to Buy will ensure homes sold are replaced with new affordable homes, including in rural communities.

“This is part of the biggest, boldest and most ambitious plan for housing in a generation backed by the doubling of the housing budget which includes delivering over 400,000 affordable homes by 2020 across the country.”