The UK’s Labour government would consider a controversial “right-to-buy” scheme to allow millions of renters in the UK to buy their rented homes for a “reasonable” price (aka way below market), according to The Independent, citing the shadow chancellor.
John McDonnell said he wanted to tackle the “burgeoning buy-to-let market” and problem landlords who do not maintain their properties.
The scheme, which could bring a day of reckoning for many of Britain’s 2.6 million landlords, is a twist on Margaret Thatcher’s policy of allowing council tenants to buy their homes in the 1980s – a move critics say helped cause the current housing crisis by drastically reducing the number of local authority properties. –The Independent
The idea, first brought up by Jeremy Corbyn during his 2015 bid for party leadership, would force landlords to sell their homes below market prices according to McDonnell.
“You’d want to establish what is a reasonable price, you can establish that and then that becomes the right to buy,” he told the Financial Times, adding “You [the government] set the criteria. I don’t think it’s complicated.”
According to McDonnell, the plan would eliminate the problem of landlords who refuse to invest in their properties in order to make a “fast buck,” while their tenants suffer in squalor.
“We’ve got a large number of landlords who are not maintaining these properties and are causing overcrowding and [other] problems,” he said.
The National Landlords Association, meanwhile, has accused Labour of threatening to “punish” every single landlord “for the sins of the few.”
Chris Norris, the organisation’s director of policy and practice, said: “To suggest that private landlords should be selling their properties to their tenants at a below market rate arbitrarily set by politicians is ludicrous. Landlords had to pay market rates themselves. It’s only right that, if and when they decide to sell it, they can do so at market rates. –The Independent
“If Labour does indeed wish to fix the housing crisis, they should focus on encouraging the government to build more social housing, which is what the housing sector is lacking,” said Norris.
Another idea of McDonnell’s, according to The Independent, would be plans for “inclusive ownership funds,” by which corporations employing over 250 people would be required to give all employees 10% of their shares. The Financial Times and law firm Clifford Chance say that the scheme would result in the forced distribution of “£300bn worth of shares in 7,000 large companies” to workers in what would be one of the largest wealth transfers in the history of Western democracy.