The Conservative party said it will extend the Right to Buy scheme and the Liberal Democrats have announced plans to build 300,000 more homes a year and ensure everyone has a decent place to live.
The Labour party says it will build at least 200,000 new homes a year by 2020 with first priority for local first time buyers and introduce three year housing tenancies with a ceiling on excessive rent rises.
Prime Minister David Cameron said that the £18billion extension of Margaret Thatcher's Right to Buy scheme will be extended to 1.3million families living in housing association properties.
It would be funded by requiring councils to sell off the most expensive social housing when it becomes vacant, replacing it on a one to one basis with more affordable property.
The existing Right to Buy allows tenants living in council owned properties local authority tenants to buy houses and flats at a discount of as much as 70% up to a maximum of £102,700 in London and £77,000 across the rest of England.
Around 500,000 housing association tenants currently have no purchase rights and 800,000 who qualify only for much less generous discounts of £16,000 or less.
But the reaction has been mixed. The Conservative plans will not necessarily boost house building and could weaken the future capacity of the social renting sector to provide a safety net for those who cannot afford to house themselves via the private market, according to Peter Williams, executive director of the Intermediary Mortgage Lenders Association (IMLA).
‘The risk is that in this manifesto along with others we will get more short term initiatives and that politicians will continue to avoid owning up to the need for a fully formed housing strategy that balances support for people across all forms of housing tenure. Delaying the inevitable will only result in more difficulties in the long term,’ he explained.
Adam Challis, head of residential research at JLL, described as good politics, but terrible policy. ‘This is exactly the kind of short termist thinking that the countries' 4.7 million households in social housing don’t need, not to mention the same number again of aspiring owners in private renting,’ he said.
‘Right to Buy benefits a select few while condemning the vast majority to longer waiting lists and fewer choices. At a time when we are building barely half the homes this country needs, we need a government that is interested in genuine solutions to the housing crisis rather than cheap vote winners,’ he added.
Colleague Richard Petty, head of affordable housing at JLL, said that extending the Right to Buy to housing associations will seriously damage their ability to help the country build its way out of the housing crisis.
‘They rely on private finance to build now, not government grant. The huge loans they carry are just big mortgages, and they require security in the form of homes, the rents they produce and their underlying market value. If that security has to be sold off to tenants at big discounts, there is a real risk that associations will become unfundable,’ he explained.
‘Loans may have to be repaid, and the receipts from sales at discounts could be insufficient to meet liabilities. We think this will mean fewer affordable homes being built rather than more, and this policy could therefore backfire spectacularly on the government for the sake of a few extra votes in this election,’ he added.
However, Nicholas Leeming, chairman of national estate agents Jackson-Stops & Staff, backs the policy. ‘Jackson-Stops supports any initiative that enables social housing tenants to buy their own property, provided that the funds realised are reinvested in the sector,’ he said.
‘But while encouraging the principle of home ownership this should go hand in hand with an active and vibrant lettings market, unencumbered by government legislation and with the ability for landlords and tenants to agree the length of lease,’ he pointed out.
Details of the Liberal Democrats policy includes bringing forward at least 10 new garden cities in England providing tens of thousands of high quality new homes and direct government commissioning of private house building to ensure houses are built at sufficient speed and have proper infrastructure and services.
The party also wants to see the creation of a new Housing Investment Bank to provide long term capital for major new developments, a new Rent to Own homes scheme where monthly payments count steadily towards buying a stake in a house and a new Help to Rent scheme to help millions of young people put down a deposit to rent their first property.
‘Liberal Democrats believe everyone should have the opportunity to have a decent home at a cost they can afford. That's why we have increased house building in government but we want to go much further. And we will help young people who want a home of their own with radical plans to help them buy or rent,’ said Deputy Prime Minister and leader of the Liberal Democrats Nick Clegg.
Brian Berry, chief executive of the Federation of Master Builders (FMB), praised the Labour party for recognising that building more homes is the only route to achieving this. ‘We also have a clear target of building 200,000 new homes a year by 2020,’ he said.
