Tories promise £40,000 handouts for tenants to buy their own homes

Speaking at a fringe session at the Conservative party conference in Bournemouth on Tuesday, shadow housing minister John Hayes said the Tories would give all social housing tenants the option to buy “the home of their dreams”.

Speaking after the fringe event, Hayes said: “We would want to give people cash to help them buy a home. Either a lump some of up to £40,000, or a significant percentage of the value of a property.”

In addition, Hayes promised to increase shared-equity schemes and to reinject money raised from tenants increasing their share in their home – known as “staircasing” – back into building more shared-ownership homes.

The Tories plan to increase shared ownership and recycle the surplus from staircasing, following recommendations made by the low-cost homeownership taskforce in its report last year (HT 21 November 2003).

Baroness Dean, who chaired the taskforce, said: “Although the government is acting on many of our recommendations, the reinvesting of surplus from staircasing is one area where it has not come back with a positive response.

“Whoever is voted into power at the next election, we would like to see take up all our recommendations.”

It is also understood the Tories have cooled on a previous pledge to extend the right to buy to housing association tenants. They would instead encourage people to take up the offered cash lump sum and buy a home on the private market to free up social housing.

Hayes said: “It’s false to presume, as the government does, that a fixed percentage of people will always want to rent; 90% of people in this country aspire to own their own home and we want to enable them to do so. People should be able to live in their dream home.”

A spokeswomen for Shelter said: “John Hayes gave encouraging signals about protecting social housing and providing for the homeless. However the proof will be in the pudding.”