‘Right to buy’ scheme to remain for Housing Executive homes

New Housing Minister Gordon Lyons MLA has said that he has no intention to bring forward legislation to end the Housing Executive’s House Sales Scheme.

The Minister was responding to a question posed by the SDLP’s communities spokesperson Daniel McCrossan MLA, whose party is calling for the scheme to be scrapped in a bid to reduce the number of households on the growing social housing waiting list.

The Housing Executive’s House Sale Scheme was first introduced in 1979 and has seen over 120,000 properties sold to tenants at a discount.

As Northern Ireland’s largest social landlord, the Housing Executive currently maintains a stock of over 80,000 homes but that number has been falling, in part due to the House Sales Scheme.

While the number of house sales under the scheme varies per year, it is understood that on average the number of homes sold by the Housing Executive per year is in the hundreds.

Under the scheme, eligible tenants of the Housing Executive have a right to buy their home at a discount. A five-year secure tenancy usually brings a discount of some 20 per cent of market value, but discounts can increase by 2 per cent for every additional tenancy year to a maximum of 60 per cent or £24,000, whichever is lower.

The scheme, which previously applied to all social landlords, was closed to tenants of registered housing associations in Northern Ireland in August 2022 following the passing of the Housing (Amendment) Act (NI) 2020.

The legislation was passed in recognition that social landlords were losing stock at a time when the social housing waiting list and volume of households deemed as in housing stress were increasing. At the end of 2023, 46,461 households were on the housing waiting list, 34,651 of whom were deemed as in housing stress.

Daniel McCrossan MLA

The waiting list challenge has seen a renewed push for an increase in supply of new social homes. The Department for Communities’ draft Housing Supply Strategy estimates the need for an average of 2,222 new social housing units per year by 2027 to address need. However, despite this, financial pressures have seen a reduction in the number of social homes (1,500) delivered this year, compared to last (1,956).

Previous housing ministers have indicated an intention to potentially close the scheme in recognition that the need to increase to supply is in contrast to the loss of social housing stock to the private sector.

“The selling of our social housing stock has been a huge contributory factor to our spiralling housing waiting lists”.
Daniel McCrossan MLA

Housing officials have highlighted that the cost to build a new social home is significantly more than the money received from social unit sales. In addition, those social housing units sold tend to be of the best quality, meaning a deterioration the average overall condition of the remaining social housing stock.

Any loss of stock equates to a loss of rental income, further restricting the finances available to the Housing Executive to maintain its existing stock.

Following the passing of legislation to end the House Sales Scheme for housing associations, in November 2020, then-interim Housing Minister Carál Ní Chuilín MLA announced her intention to bring forward a consultation on the Housing Executive’s House Sales Scheme and make changes before the end of the electoral mandate, with the aim of addressing “the need to protect social housing stock and deal with the inequity in the social housing”.

However, following the restoration of the Northern Ireland Executive in February 2024, new Housing Minister Gordon Lyons MLA has now stated that he has “no plans” to bring forward legislation to end the Northern Ireland Housing Executive’s House Sales Scheme.

This is despite recognition from a senior official in his department that the decline in the number of Housing Executive-owned home is potentially unsustainable.

Mark O’Donnell, Deputy Secretary of Housing and Sustainability at the Department for Communities, told the Northern Ireland Assembly’s Communities committee that: “There is no doubt that the number of Housing Executive homes is declining at a fairly, maybe unsustainable, rate because of the ‘right to buy’ scheme.”

O’Donnell said that while he knew the abolishment of the scheme had been on the agenda for other ministers in the past, he was not in a position to pre-judge the current minister’s outlook.

Speaking after receiving written confirmation from the Minister that he did not intend to legislate, the SDLP’s McCrossan highlighted that his party has long called for the scheme to be scrapped in recognition that “the selling of our social housing stock has been a huge contributory factor to our spiralling housing waiting lists”.

McCrossan added: “When the Assembly returned, I asked the new Communities Minister Gordon Lyons to give his view on the policy only to be told he has no intention of ending it. This seems particularly short-sighted given the failure to accelerate housebuilding in the North over recent years, with the cost of materials spiralling, all while social housing stock is being sold off.

“I would urge the Minister to look again at this proposal and the SDLP opposition will continue to push for the end of this practice that has undoubtedly contributed to our housing crisis.

“We will never address these issues without taking tough decisions and the Minister needs to act now before things get even worse.”