Give council tenants the right to move

The Ideas Factory is a chance for you to pitch your own idea of what should be in the next Liberal Democrat manifesto. The proposal here is not the policy of the Social Liberal Forum. We will however be passing it – and the response it generates – onto the Manifesto Working Group.

The Proposal

Dr Tim Leunig: Those in social housing should be allowed to require their landlord to sell their home and buy a place of their choice.

housingCouncil and housing association tenants get little choice over where they live and are rarely able to move: many are in properties that do not suit their individual needs and preferences.

This can and should change. In a paper published by the Policy Exchange, The Right to Move, I argue that social tenants should have the right to move, the right to require their landlord to sell their current home and use the money to buy a place chosen by the tenant.

The new property would be owned by the landlord, and rented out as before. Tenants would be better off: they would get to live in a house of their choice.

The value of the landlord’s portfolio does not change – only its location. Of course, if a Lambeth tenant moves to Croydon, Lambeth will need to subcontract the maintenance to Croydon, but this is hardly difficult. Landlords could veto properties with disproportionately expensive maintenance – thatched cottages and the like. When the tenant leaves social housing, Lambeth could sell the Croydon property and buy one in Lambeth as necessary.

There are important advantages for society.

First, all tenants would gain a real stake in their house and area. Since they might one day want to move, they have an incentive to look after both, to report little problems before they become big ones, and an incentive to stand up against antisocial behaviour that plagues too many social housing estates.

Second, when social tenants move out of estates they would integrate with those living in other tenures. In addition, as some estate properties are sold on the open market, those estates would become more mixed, leading to better-integrated communities.

Third, social tenants could, for the first time, move easily for job related reasons, both within their own town and further away. This is good for them, but it is also good for society more generally, since it raises tax revenues and cuts benefit spending.

Fourth, poorer families could do what many middle class families do when they have children: move to areas with more space and better schools. Flats in city centres are generally as valuable as houses in the suburbs, allowing many families to move.

The only question is who should pay the costs of moving: selling fees, valuations and legal costs. Given bulk buying, these amount to around £1,000. The gains to society from greater social integration, as well as higher levels of employment, make a case for these to be subsidised to encourage social tenants to move, and we suggest that the state should allow tenants a “free move” once every five years. Those who wish to move more often would have to pay the fees themselves.

The right to move is about freedom, dignity and opportunity. It is about giving the same choices to those who are poor as to those who are middle class. It has the potential to transform the lives of millions of people living in social housing, by allowing them to decide where they live.

Note: This article was originally published on Comment is Free.


Dr Matthew Sowemimo: Social housing has traditionally been one of the areas where the state has been the least responsive to poorer communities. This proposal has the merit both of providing a practical means to securing more socially mixed communities and extending genuine choice to people who have often simply been ‘allocated housing.’ This proposal is absolutely consistent with Social Liberal Forum’s philosophical approach about how state action has to be refashioned in order to bring about equal life chances.

Susan Gaszczak: Whilst I agree that council and social housing tenants should have the right to move, I think there is a whole section of the community living in privately rented property that require more urgent attention and policy. People living in private rented property are subject to the standard of the landlord. Often you will find families who are classed as living in poverty in properties with inadequate heating, little insulation and a multitude of problems that cost large quantities of money. Sub standard private housing really needs to be tackled as well as giving social housing tenants the right to move.

Tagged with: ,
Posted in blog archive, The Ideas Factory
13 comments on “Give council tenants the right to move
  1. Peter Black says:

    Interesting as this idea is, it will not work without a considered reform of the housing subsidy system that requires 75% of any housing capital receipt to be used to repay debt. Nor does the proposal say where the money will be coming from to buy the new property. Even if all of the capital receipt can be retained there will inevitably be a shortfall. Will the new property be rented out at a market or a social rent?  How does this fit in with Margaret Beckett’s current consultation on the housing subsidy system. How do you manage the expectations of tenants as to the property they wish to acquire. How do you manage the scarce resources available to councils to deliver this reform whilst still meeting statutory obligations to the homeless etc, especially when the problem facing many Councils is not tenant choice but no houses to offer to a growing waiting list?

    These may just be details but they are very important details. It is all very well coming up with ideas consistent with liberal principles but unless you can practically implement them then you are conning people by creating unrealistic expectations.

  2. Jock says:

    I’ve seen this idea from Tim before – presumably when it was on CiF.  Clearly I don’t believe such measures should be necessary, and would not be under an LVT system… :)

    But, accepting that there are a number of practical issues, some of which Peter mentions, that would need to be dealt with (by the way Peter I *thought* that on a back-to-back deal – which this would be – a local authority landlorrds could use all the receipt just not on ad hoc “right to buy” deals – a deal can certainly be constructed in such as way I’m sure as there is an example of such on an estate redevelopment in Oxford), I think this is a reasonable idea.

    There’s one particular area that you don’t mention as a benefit though – and that is the issue of underoccupancy, especially by older households whose families have left home and where research shows that a very high proportion of them would “downsize” if there was somewhere appropriate for them.  At the moment these people “bed block” family  housing, even though they may like to move.  Now I guess the sold family home would not be a houdehold off the waiting list, since it is going private so to speak, but it would be one family off the larger list of families competing for *any* family housing.

    Can I suggest an improvement – that the newly acquired social housing goes into a vehicle such as a Community Land Trust, rather than just back with the authority concerned – that would give tenants the ability to begin to build a financial stake (useful if the move has been in order to take up a better paid job or something) – the “buying” authority would have a partnership stake in that national land club, if you will, and could disinvest from it at any time, or continue receiving its share of rent – giving it more flexibility about reinvesting in their own area.

    Though Tim, I really wish you would come over to the dark side and just have to use your considerable influence and powers of persuasion to fight for the real silver bullet to all this – LVT – rather than forever coming up with great ideas about how to soleve little bits of the LVT puzzle without actually implementing it… :)

  3. Tim Leunig says:

    Matthew: Thank you for your support.
    Susan: Thank you as well for your support. You are right that other sectors have other issues. There is a limit to the amount of solutions I can propose in one article :-)


    Always a pleasure to reply to someone who is engaging seriously with the idea.

    1) It requires that the 75% rule is abolished if another property is being bought in lieu. The point of being in govt is to abolish silly rules like these.

    2) The money to buy the new house comes from selling the old one.

    3) The new property will be let out under exactly the same terms (including rent levels as the previous one)

    4) I am not sure which expectations you are referring to – tenants are told that they can move if they can find somewhere that they prefer that is no more expensive.

    5) Statutory obligations to the homeless etc (which are critically important) are unaffected, and the resources to do so are unaffected.

    These are important details, and I hope that my answers reassure you. The full version of the paper (available from Policy Exchange website) has a foreward by the chief exec of a Housing Assoc – she thought that it would work in practice, and that gives me confidence that they would.

    Jock: as ever, I am always willing to listen to LVT schemes provided that they include some figures. People make claims for LVT but until I see some numbers I can’t judge whether those claims are sensible. I have asked every LVT fan who has ever written to me to do so. Some have said no, and others have sent numbers that were silly.

    I don’t see how you can claim that LVT would help the 90 year old man I met recently, trapped in a first floor flat. He just needs to move downstairs. For him, and others like him, the right to move is the best and most efficient possible policy. Giving him the freedom to move would transform his life. Isn’t that what social liberalism is about?

    The full version of the paper, including the foreword, can be found here: (click on “download” underneath the paragraph of text)

  4. Peter Black says:

    Tim, I had a quick look at the document itself and noticed straight away that it fails to differentiate between different types of social housing. The financial regime for RSLs and local Council housing is in fact markedly different. In particular local Councils have to work within the housing subsidy system. This is more than just having to repay debt on sale it also controls rents and the level of income that a Council is allowed to receive in rents. If a Council exceeds this amount then it is clawed back as negative subsidy, if it falls short then it gets positive additional subsidy. Thus the 22 Welsh Councils are all in negative subsidy, effectively paying £75 million each year to subsidise richer English Councils. Sales are take into account in this calculation.

    The other factor is the level of debt that a local Council has. Councils embark upon stock transfer not because they cannot borrow money (under prudential borrowing they are allowed to borrow provided that they have the revenue to pay back the money) but because their income streams are insufficient to borrow enough capital to carry out the necessary works, made worse when some of it is clawed back as negative subsidy. The only way that stock transfer works is that it takes the housing stock out of the subsidy system whilst the Treasury pays off the debt. In some cases up to half a Council’s income stream is used to repay debt giving them little choice when a house is sold other than to use the receipt to repay that debt.

    There are also questions about the time lag between selling the Council house and buying the new one, especially when the Council home is difficult to sell because of its condition or because it is in a poor area. I agree that we need to break up monolithic estates but we can do so by selling them off in parts to other social landlords or for redevelopment, whilst using Social Housing Grant to buy up private homes for rent on private estates. That is the best way to achieve choice.

    I do not want to pour cold water on what seems an attractive idea but I really do think that it is fraught with practical difficulties and is a distraction when Councils have far more pressing calls on their resources at a time of recession and during a slump in the housing market.

  5. Tim Leunig says:

    Peter, part 2.

    First, thanks for your further comments.

    I don’t differentiate between HA and Council financing because there is no need to in this context. (nb from memory Kingston Council alone pays £32m to central govt so as you can imagine this is a live issue). Under my scheme the council sell one house worth £100k and buys another worth £100k. They rent it out for the same rent as before. Nothing changes in financial terms for the council – they are in exactly the same position as before. The govt treats the council as now (there are good reasons to change that, but that is a separate issue). Ditto if the house is HA owned. The HA sell one house worth £100k and buys another for £100k. The HA continue to charge the same rent as they did before, and govt treats the rental stream the same. Nothing changes, and so the issues that you raise are not an obstacle.

    Your second para is about stock transfer. No stock is transferred in my scheme.

    Third para. There would be no time lag between selling one property and buying another – the tenant would end up in a chain, just like an owner occupier. Their property would be sold on the day the new one was bought. Otherwise there could be all sorts of problems.

    Always happy to exchange comments – as you can see, I think I have the answers to allow this liberal scheme to be a practical one. :-)

  6. David Heigham says:

    This is ‘obvious nonsense’, just like the right to buy your council house was all those years ago. I agree with Matthew. This one is a runner.

  7. Andrew says:

    Out of interest, how fluid is the market at this level?

    I would presume (correct me if I’m wrong) that social housing generally tends to be towards the cheaper end of the market, so what would be available at the same price? Do you envisage a kind of internal market where social housing landlords sell properties to each other, or would it actually be possible to break out into the wider property market?

    And the new house can’t be more expensive, but can it be cheaper? e.g if Mr and Mrs X want to go and live near Grandma X, but Grandma X lives in a dodgier part of town, does the landlord have the right to refuse that sale?

    Feel free to brush me off to the main report if these questions are answered therein, only had time to skim it.

  8. Peter1919 says:

    Just looking at the practical implemenation of this I don’t see how this wouldn’t end up costing a great deal of money as the following would have to be paid for at each move

    - Surveys
    - Stamp duty
    - Solicitors fees
    - estate agents fees (?)
    - costs of moving house (i.e. paying movers)

    I also believe there are minimum standards required for social housing so as well as the new property having to be of the same value as the old one it would have to also meet these min standards or else there would be the additional cost of bringing the new property up to standard.

  9. Tim Leunig says:

    The market is pretty fluid, although it depends on the area. Look in your local property paper for a sense of what ex-LA homes are worth, and then think what else you could buy for that money. In general people would get a reasonable choice of other ex-LA property, and smaller terraces. Or they can get something bigger in a cheaper part of town, or smaller in a dearer part. Or just move somewhere similar nearer to Grandma/the bus stop/etc.

    The costs are much smaller. Stamp duty is not levied on SH purchases, so there are only surveys and legal fees. I would expect surveys and estate agents to be done in house, which would cut the cost dramatically. I estimate £1000 all in. A pilot is the only way to find out. Remember that if more people end up in work there are big savings to govt. Or if school results improve. £1000 is small in that context.

    If you move to a cheaper house the SH agency keeps the difference. This would increase the stock of SH, esp as some people in central London would move out to the suburbs.

  10. Andrew says:

    Out of interest, did you have anything to do with this Tim?

  11. Tom says:

    This is a typical policy wonk nonsense that ignores the real world.
    I live in a sink estate, with a flat worth £60k, I demand the council sell the flat (rather assumes there is a buyer, just desperate to move into a sink estate !) and they buy me a two bed-roomed cottage in posh village. (assuming there is one for sale) for £500,000k. It aint going to happen.

    Tennants used to be able to move when there was more social housing stock. That is the real issue.

    The beneficial effect of this proposal could be achived by allowing councils to purchase property on the open market for use as social housing.

    The idea that the right to move would seriously impact on people “to stand up against antisocial behaviour” is wishful thinking of the worse new Labour style. Yet this is given as the 1st advantage.

    What about people in shared ownership schemes ? What about people in key worker schemes ? If I downsize as a tenant in london and move to wales, do I keep the £500,000 difference in house price ?

  12. Tom says:

    What if you move away from London, the “social landlord” or quango as we call them gets the difference in house price, but when it all goes wrong and you wnat to move back – your now stuffed.

    I notice this idea was trashed in the Guardian but seems very similar to Conservative Party pronoucements – hardly social liberalism.

  13. Paul Angell says:

    Has there been any movement on this at all with the politicians. I am someone in social housing. I actually have a lovley house but want to move to dorset due family.

Leave a Reply

Your email address will not be published. Required fields are marked *


You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>

Follow us on Twitter

Blog archive