A think tank has called for Right to Buy to be extended to the private sector.
Peter Saunders from Civitas claimed giving tenants in private rented properties the Right to Buy would help solve the housing crisis.
He suggested giving them a 35% discount off a property’s market value up to £77,900 outside London and £103,900 in London but to compensate landlords with capital gains concessions when they sell.
He proposed only introducing Right to Buy on properties older than 25 years to incentivise landlords to invest in new builds.
Saunders said: “The Right to Buy which is currently enjoyed by tenants in the social rented sector should be extended to tenants of landlords in the private sector with discounts capped to prevent landlords incurring losses.
“This Right to Buy should not apply to properties less than 25 years old, landlords should be partially compensated by capital gains tax concessions when they sell, and the standard duration of tenancies in the private sector should be extended to five years.
“Prospective landlords (private as well as institutional) would in future be encouraged to buy new-build properties, for these would be immune from Right to Buy for 25 years (ample time to make a decent return on the initial capital outlay).
“This would give a boost to new housing supply. But they would tend to steer clear of buying older properties, leaving more of the second-hand market to buyers who wish to live in the property.”
Saunders claimed that his proposals would put a downward pressure on house prices, especially at the lower end of the market as tenants take advantage of the Right to Buy discount to trade up.
His proposal document ‘Restoring a Nation of Home Owners: What went wrong with home ownership in Britain, and how to start putting it right’ is available on the think tank’s website.
Labour leader Jeremy Corbyn has previously supported introducing Right to Buy to the private sector.