Council house sale discounts have cost Kirklees Council a staggering £9m in less than two years.

Like all local authorities, Kirklees has to sell council houses under the Right to Buy scheme and they must give the tenant a discount on the market price.

The Examiner has discovered that a collective discount of £4,725,739 was offered on 135 house sales in 2013, despite the market value for all properties topping £9,938,000, with cash of just £5,212,261 coming in.

To date in 2014 there have been 126 house sales with a collective discount of £4,317,936, when the market value for all properties should have been £9,425,500 but sales were just £5,107,564.

Council leader Clr David Sheard said: “I wouldn’t mind the Right to Buy if it was the government that covered the discount and not us.

“You have to remember, this is just because we helped people out with housing when they really needed to be helped, and it’s right we do that.

“But if the government really wants the Right to Buy they should give us the money that we’re losing and not expect us to cover the discount.

“I think a preferable scheme is the government gives the discount to the buyer to take with them to buy in the private sector, which means we can keep our housing stock for the people who need it.”

He cited a case at Brighton and Hove Council, where housing bosses are asking the government for permission to end the scheme because of evidence that 1,000 of the 6,000 sales ended up in the private rental market.

In 2013 in Kirklees the stock sold included 14 one-bed flats,13 two-bed flats, two two-bed bungalows, two two-bed maisonettes, 36 two-bed houses, 55 three-bed houses and four four-bed houses.

So far in 2014 the sales have comprised 15 one-bed flats, 10 two-bed flats, three one-bed bungalows, one two-bed bungalow, one one-bed house, 43 two-bed houses, 50 three-bed houses and one four-bed house.

Clr David Sheard
Clr David Sheard
 

Discounts top tens of thousands for each sale, with a one-bed flat with a market value of £50,000 selling for just £15,000 after the discount has been applied.

A three-bed house worth £120,000 was sold with a £63,600 discount, with the council getting just £56,400 from the sale.

And it means Kirklees has lost much-needed housing stock when 8,612 people re currently on the housing register. Some 5,287 – 61% of the register – have been actively seeking a home in the last six months.

People can apply to buy their council house if it’s their only home and they’ve lived in the public sector for five years.

The discount increases the longer someone has been a tenant, it starts at 35% with 1% added for each addition year a person has lived in public sector housing up to a maximum discount of £77,000.

For those living in a flat, the discount starts at 50% with 2% added for each additional year.

While the sale of council houses at full market value would not halt the £69m cuts councillors are having to make, the combined £9.04m discount would cover the loss of government grant, announced in December as £8m less for 2015/16.

It would also cover the £5.754m library service; plus cover the £462,000 proposed council cuts to the Citizens Advice Bureau, the Law Centre and Fusion Housing; plus the £299,000 grant the council gives to Kirklees Music School, which campaigners are trying to save, plus it could go some way to saving some of the 1,400 council jobs at risk.