Rachel Reeves has slashed right to buy discounts introduced by Margaret Thatcher as part of an affordable housing drive.
The Government will allow councils to retain all the revenue from the sale of social housing to reinvest it back into providing new homes in an effort to ensure the stock of council houses does not fall further.
The move comes amid a housing package championed by Angela Rayner that includes £500million in new funding for up to 5,000 new affordable social homes.
Another £128million will support delivering 33,000 new homes through projects across the country.
The Chancellor today announced more than £5 billion of investment in housebuilding next year, including £3.1 billion for the Affordable Homes Programme, and investment for sites in Liverpool and Cambridge.
Ms Reeves said: “We will increase the Affordable Homes Programme to £3.1billion, delivering thousands of new homes.
“We will provide £3 billion of support in guarantees to boost the supply of homes and support our smaller housebuilders. And we will provide investment to renovate sites across our country, including at Liverpool Central Docks where we will deliver 2,000 new homes, and funding to help Cambridge realise its full growth potential.”
Roger Mortlock, chief executive of the CPRE countryside charity, said: “We are delighted that the chancellor has set a budget of £3.1 billion to deliver affordable housing. So-called ‘affordable’ housing is often far beyond the means of most people, however.
“Affordability should be defined in line with average local incomes, rather than as 80% of market value, as is currently the case. When the average price of a house in rural England is more than 16 times the average rural salary, so-called ‘affordable’ homes are often anything but.
“£3bn of support and guarantees for small housebuilders is excellent news for an industry that is dominated by a few profit-hungry giants.
“At current rates of construction, it would take almost a century to clear social housing waiting lists in rural parts of the country. Investing money from Right-to-Buy in more social housing is a welcome step in the right direction.”
