Hackney Council has spent £38 million since 2020 buying back houses it used to own

Calling for reform of Right to Buy: Mayor Caroline Woodley. Photograph: Hackney Council

Hackney council has spent £38 million since 2020 buying back houses it used to own.

The purchases relate to properties the council sold under Right to Buy, a controversial legacy of the Thatcher government which gives local authorities no choice but to sell off homes at a discount to tenants who have lived in them for three or more years.

This discount, and the boom in Hackney property prices – which increased by 105 per cent from 2011 to 2021 – has seen the council lose a significant amount when buying back its former properties.

In one example, Hackney Council sold one property for £95,050 in 2014, only to buy it back for £365,000 in 2021 – a loss of £269,950 in six and a half years.

Mayor Caroline Woodley said: “In Hackney we have one of the most ambitious programmes of building new social rent council homes in the country, but I know we can’t just build our way out of the housing crisis.

“That’s why we’re buying back homes lost under Right To Buy, so they can once again be used as the social housing they were built as and prioritised for local families who need them most.”

The new figures on the effects of Right to Buy have been revealed by the Big Issue, which submitted Freedom of Information requests across 53 UK councils with some of the longest housing waiting lists.

Their investigation shows these councils sold 20,836 homes under Right to Buy in the past five years, securing £2.25 billion in the process – an average of around £40 million per council.

These same 53 councils purchased 8,590 properties from 2020-2025, at a cost of £2.12 billion – an average of around £40 million per council.

This means that whilst councils have spent almost the same amount as they have received, they are 12,246 homes down.

Mayor Woodley said: “It is frustrating that we have to buy properties for many times what they were sold for.

“We’ve long called for reform of a broken Right To Buy policy, and have welcomed government plans to scale back the scheme – including exempting newly-built homes and extending how long tenants must live in a property before qualifying for a discount.”

Introduced in 1980 Right to Buy was set up to increase rates of home ownership.

Whilst initially successful in its main priority, the policy has been blamed for depleting council housing stock after successive governments failed to replace properties sold under the scheme, often at a significant discount.

The Labour government will not abolish Right to Buy entirely, unlike Scotland and Wales, but has instead planned a series of reforms.

Under these reforms, newly-built social housing in England will be exempt from Right to Buy for 35 years.

Social tenants will have to live in their properties for 10 years, up from the current three years, before qualifying for the scheme.

Discounts will start at 5 per cent of a property’s value with a maximum of 15 per cent, down from 35 per cent for houses and 50 per cent for flats currently.

But at the moment these are still just plans, with the government saying changes to legislation will be delivered “when parliamentary time allows”.

This comes on the backdrop of a homelessness crisis which is stretching council budgets.

Hackney council has the largest temporary accommodation hostel stock in London but it is not enough to meet demand.

In September 2024, Hackney Council recorded more than 13,000 households on its housing register and more than 3,500 households in temporary accommodation.

The local authority is projected to spend £135 million on expanding and maintaining its temporary accommodation in 2025/2026.

At the same time, Hackney has seen its total debt growing by 150 per cent since April 2024 – from £63 million to £153 million – as it took out more long-term loans mostly tied to housing and regeneration projects.

A Hackney Council spokesperson said its finances are stable, with the local authority having balanced its budget at a time where other councils have been forced to seek extra funds from the government.

Mayor Woodley said: “Whether it’s delivering vital new council housing ourselves, maximising and protecting social rent homes in private developments or supporting housing associations to build more in our borough, I am determined to tackle the housing crisis in Hackney.”