Sales of social sector housing to sitting tenants
The introduction of right to buy legislation in 1979 had a substantial impact on the profile of Scottish housing, and the scale and nature of these changes are shown in the 2006 report to the Scottish Parliament The right to buy in Scotland: pulling together the evidence.
Over the years, nearly half a million public sector properties have been sold under the Right to Buy scheme (Chart 6). The annual rate of sales to sitting tenants peaked at just under 40,000 in 1989, at the height of the housing boom. It then fell rapidly in the early 1990s as the housing market crashed, settling at around 15,000 per year from the mid 1990s onwards. Legislation introduced as part of the Housing (Scotland) Act 2001 then resulted in significant changes in right to buy terms for new tenants from 2002-03.
After a small upturn in 2002-03, sales have declined consistently with decreases varying between 10% and 22% per year, to a current level of about 6,800 public authority right to buy sales for 2007-08 (including local authorities with total stock transfers). This decrease is to be expected, because following the change in legislation, new tenants are on modernised terms which in most cases means they could not buy until October 2007 at the earliest, and this on less favourable terms then previously.
Since the change in legislation, there have been around 1,500 modernised sales, representing 3% of the total number of sales over that time period. The scale of sales to sitting tenants since the inception of the Right to Buy scheme in 1979 is shown in Chart 6.
Local authorities can apply for the Scottish Government to grant pressured area designation for specified localities, resulting in the suspension of the right to buy for all modernised tenancies in local authority and registered social landlord properties for up to five years. Currently, ten local authorities have made successful applications for pressured area designation and several more have applications under consideration. Furthermore, the 2007 Scottish Government discussion document Firm foundations: the future of housing in Scotland suggests that new social housing should be exempt from right to buy.
Chart 7 below, shows the numbers of sales in each local authority under the old and modernised terms. This chart includes sales of former council houses in local authorities which transferred their stock to housing associations. North Lanarkshire had the highest number of sales in 2007-08, at around 760, followed by South Lanarkshire at just over 600. These represent 2.0% and 2.3% of the normal letting stock in these local authorities respectively.
