More details have emerged about Labour’s controversial proposal to allow private rental tenants that right to buy their landlord’s property, at a discount - even if the owner does not want to sell.
On the BBC One Marr Show yesterday, the architect of the policy - Shadow Chancellor John McDonnell - said that his party would ensure there was a “fair price assessment” of any buy to let property which a tenant may want to purchase.
"I don't expect anyone to lose out” he told Marr; the BBC journalist did not probe McDonnell further on the issue, but that could mean no buy to let owner getting below their purchase price: that could, of course, mean the sale would still be at a below-market price as it would not have to take into account capital appreciation since the investor bought the property.
Last week the Financial Times broke the story of McDonnell’s surprise attack on buy to let. Then he told the newspaper how he would set about allowing tenants to buy their landlord’s property.
“You’d want to establish what is a reasonable price, you can establish that and then that becomes the right to buy … You (the government) set the criteria. I don’t think it’s complicated.”
Landlords failed to reinvest in properties and had made a “fast buck” at the cost of the community and their tenants, McDonnell argued.
“We’ve got a large number of landlords who are not maintaining these properties and are causing overcrowding and these problems. In my street now, a third of the houses are right-to-buy, badly maintained, overcrowded; it’s horrendous” he insisted.
Meanwhile The Times has calculated that Labour’s proposal could cost Britain’s 2.6m landlords no less than £50 billion in lost income and appreciation, depending on the conditions applied to the policy in the event of a Jeremy Corbyn-led government.
The newspaper says this would be an average of £18,400 lost to landlords.