Door shuts on sale of costly council houses

MINISTERS have reversed plans to sell off the most valuable council houses to pay for cheaper social housing after admitting the policy was a bad idea.

James Brokenshire, the Housing Secretary, said the Government would no longer “take forward” the plan announced under David Cameron in 2015, as officials admitted it was acting as a brake on development.

It comes after Theresa May signalled a rethink on housing policy by saying people should feel “proud” to live in a state-owned home in a departure from the Tories’ traditional emphasis on the right to buy.

Mr Brokenshire said the Government had decided on a “shift” in policy which meant scrapping a plan in the 2016 Housing and Planning Act to raise money by selling the most valuable council housing assets. Mr Cameron wanted local authorities to sell the properties on the open market when they became vacant, and give the money to the Treasury to invest in new affordable homes across the country.

But councils could not be forced to sell off the properties, and because they did not get to keep the money themselves they were reluctant to

do so. Having to wait for properties to become vacant also made it hard for councils to plan ahead, and retaining the high-value homes gives councils security for loans to build more houses.

A spokesman for Mr Brokenshire said: “Forcing councils to sell off these high-value properties was actually slowing down the process of building social homes. We listened, and we have developed our policy.”

Instead, the Government has set aside £2 billion in extra funding to 2028-29 to give housing associations the long-term certainty they need to plan developments.

Yesterday, Mrs May became the first Prime Minister to address a summit of the National Housing Federation, the trade body for housing associations. She said affordable housing should be built next to private homes on new estates and must not be “tucked away”.

Council houses must not be “out of sight and out of mind,” she said, as she also urged developers to design and build affordable homes to the same standard. Mrs May said: “You should not be able to tell simply by looking which homes are affordable” as she warned that “distinct” social housing helped “cement prejudices and stigma”.