Changes for social housing?

The Social Housing Bill introduced into parliament in May this year proposes sweeping changes to the right to buy. Having reached its third reading in the House of Lords before the summer recess, on resumption of business in September it swiftly cleared the Lords and is currently under consideration by the Commons with a report to that House expected by the 3 November.

Why is it important?

With insufficient decent quality housing to meet demand, it aims to protect existing social housing stock by reducing the number of social homes sold through both the Right to Buy and Right to Acquire schemes. It is also hoped that the provisions will remove a disincentive to building new social housing.

What are the changes to Right to Buy?

• Eligibility threshold will increase from 3 to 10 years
• Exemption from eligibility added if a tenant or their spouse owns other residential property
• Discounts are reduced to 5% rising by 1% for every year over 10 years to a max of 15%
• New homes will be exempt for the first 35 years
• Timescale to repay the discount increases from 5 to 10 years
• The right of first refusal given to the former landlord will be extended from 10 years to be in perpetuity.

The bill will also tidy up provisions in previous legislation which have not been implemented but have created uncertainty in the sector for local authorities. Therefore, powers to phase out lifetime tenancies and to charge higher rents for social tenants with higher incomes will be removed.

What about the Right to Acquire?

The Right to Acquire allows eligible housing association tenants in England to buy their home at a discounted price.

The aim of the bill is to align the two schemes. Therefore, most of the changes made to Right to Buy outlined above will also apply to this scheme. What will not change is the discounts, which will continue to be from £9,000 to £16,000 depending on location.

How will the bill affect private registered providers?

They will be obliged to give at least four weeks' notice to the local authority and private registered providers of their intention to complete the disposal of any property out of the regulated sector.

The notice will provide the recipients with an opportunity to consider whether they wish to acquire the property.

The National Housing Federation is currently seeking view on these proposals, on the timescale of four weeks. They are keen to argue for the shortest notification period possible to avoid unduly impacting "effective housing management" whilst still providing increased opportunities to retain homes within the sector.

What about shared ownership?

The Lords during its report stage introduced an amendment requiring the Secretary of State to conduct a review of the effectiveness of the shared ownership scheme within 12 months of Royal Assent. This unusual provision reflects the concerns raised by the Lords during the progress of the bill in that House as a result of representations received from individual shared ownership leaseholders.

The review must deal with:

• Affordability
• Whether it is a viable route to full home ownership,
• The operation of staircasing arrangements, including the costs, fees and valuation requirements
• Barriers to staircasing to either higher levels of ownership or to full ownership
• The impact of service charges, repair obligations and other housing costs on shared ownership leaseholders, and
• Whether legislative or regulatory change can improve transparency, affordability and access to full ownership.

It remains to be seen whether the Commons will agree to this remaining in the bill.

How are victims of domestic abuse to be given protection?

Schedule 1 strengthens protections for social housing tenants who are victims of domestic abuse by:

• Giving powers to the landlord to take possession of a property where domestic abuse has taken place but without the victim needing to leave
• Providing a mechanism to allow the transfer a joint tenancy into the sole name of the victim where they want to remain
• Giving courts the power to make an order to provide the victim with suitable alternative accommodation
• Providing a safeguard to ensure perpetrators cannot unilaterally end a joint tenancy in retaliation to possession action

Conclusions

Local authorities reported 14,275 eligible sales during 2025-26. The government hopes the new legislation will reduce this number. Indeed, their impact assessment published in June this year projected a net gain of 18,000 social homes over the next decade as a consequence of implementation of the bill.

What is clear nevertheless is that more social housing is needed to meet a rising need.

During the debates in the House of Lords there were concerns that the effect of the bill, despite its title, was very narrow. Baroness Taylor on behalf of the government acknowledged during the third reading that it was deliberately so since other reforms were possible without primary legislation. She closed the debate by saying, 

"This bill aims to make sure that we get the balance right in giving people the opportunity to buy their own home without impacting unnecessarily on that housing supply." 

The bill has been welcomed by those who represent the social housing sector with other organisations saying that further action is needed to improve social housing provision.