Changes to the Modernised Right to Buy

Elderpark is seeking to hold onto our stock for future generations.

The modernised Right to Buy (RTB) was extended to Housing Association tenants by the Housing (Scotland) Act 2001.  This right was suspended until September 2012.  The same Act gave Scottish Ministers powers to extend that suspension.  The Scottish Government has now set out the requirements which the Association need to clarify in order that this suspension may be extended.

Elderpark Housing Association is in the process of developing a case for consideration by the Scottish Government to extend the suspension.  The Association believes that a large increase in the number of RTB sales may be detrimental to the objectives of the Association.   These are detailed below.

• The demand for our housing is increasing and is projected to increase further with changes in homeless legislation, yet the supply will decrease because the Association is unlikely to build new housing to replace those sold under RTB.

• The decrease in the level of Housing Association Grant funding means that the Association is unlikely to be able to afford to build new units.  This means that we cannot replace houses sold under RTB.

• The Association has increased substantially our loan portfolio to invest in new build developments and therefore proportionately the level of rent needed to service this debt.  RTB sales will reduce the rental income we collect which may result in the Association being unable to meet the conditions attached to these large loans.   Should this occur banks may charge higher interest rates because lending to the Association would be viewed as being more risky.  Higher interest rates mean that there is less money available to invest in property and services.

• RTB sales can result in an increase in private rented accommodation, which in traditional tenemenal stock can result in management problems associated with managing anti social behaviour and paying for communal planned maintenance.

• A large increase in the number of RTB may depress demand for new build home ownership in the immediate area.  The knock on effect may be that brown field sites in Greater Govan may become less economically viable to develop.   This in turn may hamper the physical and economic regeneration of Govan.

If you have any views we would like to hear from you.  Please email admin@elderpark.org or phone us on 0141 440 6156 and ask to speak to Aidan.