Right to Buy discounts have cost taxpayers £200 billion since days of Thatcher

Right to Buy discounts have cost taxpayers nearly £200 billion since 1980, new research has found.

A report from the Common Wealth think tank shows the 1.9 million council homes sold in England since 1980 are now worth £430 billion.

Of this sum, £194 represents equity that was effectively given away through discounts that averaged 43% from 1980/81 to 2023/24.

Local councils received just £51 billion for these sales.

Today, one in six private tenants in England rents a former council home, paying substantially higher rents for the same homes.

The report estimates council homes worth £176 billion have entered the private rental sector.

Chris Hayes, Chief Economist at Common Wealth, said: “The severe financial straits facing councils should be seen in context of a decades-long assault on local government, in which Right to Buy was a central pillar, denying councils discretion over how best to use assets that they had built.

“Now those assets are in dire shortage and councils still bear the heightened cost of seeing people through the housing crisis.”

Adjusted for inflation, Right to Buy has been the second biggest privatisation in UK history, after land sellofs.

Economic geographer Brett Christophers has estimated the value of land privatisation was around £400 billion in 2016 prices.

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By that point, the Right to Buy giveaway had already cost £147 billion in discounts - with the total value of homes sold at £326 billion.

It’s the only privatisation that has combined widespread discounts with this kind of scale.

Kwajo Tweneboa, a social housing campaigner and author of ‘Our Country in Crisis’, said: “We’re in a housing emergency. Millions stuck on waiting lists. Tens of thousands living in temporary accommodation that’s unfit and unsafe.

“All while homes that were once publicly owned are now profit-generating assets for private landlords. That’s the legacy of Right to Buy - a policy that gutted council housing and transferred public wealth into private hands.”