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Written by Annette Tilbury, National Account Manager at West One

Since the introduction of ‘Right to Buy’ in 1980 social housing stock has rapidly declined, with 1.5 million fewer social homes available today than there was in 1980. While the population of the UK has grown from 56.3 million in 1980 to an estimated 66.8 in 2019 creating a housing emergency where stock is far outstripped by demand.

One solution that councils, housing associations and third-party organisations are adopting is to lease homes from private landlord to then sublet to tenants. In this report, we will look at the changes to social housing, why private landlords would consider renting their property to a housing association and how landlords can finance this type of property investment.


A brief history of social housing

The end of the Second World War brought about the worst housing shortage of the twentieth century, with houses across the country destroyed or badly damaged by heavy bombing. Successive post-war governments carried out programmes of social housebuilding with 4.4 million social homes being built between 1945 and 1980.

In 1980 Right to Buy was introduced and new restrictions were enforced that limited the power and resources that local authorities had previously held to build and manage social housing. By 1983 the level of social housing building halved. As a result, social homes have been sold off faster than they have been replaced, leading to the shortages experienced in the present day.


Leasing a property to council or housing association

There has been an increase over the last few years of the number of councils, housing associations and third-party organisations that are opting to lease a property from private landlords to house tenants including asylum seekers and DSS recipients.

Although in some areas the rent may be 10-20% below private market value, this will be received on time every month regardless of the property being occupied. The prospect of guaranteed rent each month for up to 5 years, regardless of the property being occupied, can be incredibly attractive for some landlords.

The terms will vary between different councils, associations, and third-party organisations but they can include a full maintenance and repairs service, regular property inspections and an agreement to return the property in its original condition at the end of the term.

The relevant authority will undertake an assessment before agreeing to lease the property and there may be more stringent requirements than if the property was being rented to a private tenant, such as more advanced safety checks.


Financing a buy-to-let for social housing

At West One, our specialist underwriters assess each case on its own merit which means that we can consider applicants who are planning to lease their property to a council, housing association or third-party organisations. West One also offer:

  • Great turnaround times from enquiry to application and offer, and proactive competition chasing.
  • No minimum income requirements.
  • Maximum age on application 80.
  • No buy-to-let experience required.
  • Lending to ex-pats living in EEA countries.
  • Limited company lending with no rate loading.
  • Agreements up to a maximum term of 60 months accepted with suitable break clause and no onerous conditions.


To find out more about West One’s buy-to-let offering please speak with the team of experts at Brightstar on 01277 508951, or email helpdesk@brightstarhub.co.uk