The right to buy: A pitfall in Dutch housing policy

By introducing the ìRight to Buyî in housing policy the Dutch government follows, though decades later, the footsteps of the British government. The Right to Buy gives tenants in social housing the legal right to buy their home. There is, however a big difference: in Britain the Right-to-Buy-dwellings are owned by local councils, while in The Netherlands the social rented dwellings are owned by private organizations, casu quo housing associations. A successful implementation of this policy will require their assistance. However, the plan receives barely their support. This potential conflict can be explained by the great expectation of the effect of this program by the government. It is assumed that the right-to-buy-scheme will cope with the preference of a group of tenants who want to buy their home: will fix the distorted relation between the rents of dwellings and the income of households; will fill the gap between the rental and owner occupied sector and so on. In short, the right-to- buy- scheme seems to be the Panacea for all problems on the housing market. Based on empirical evidence in Eindhoven and elsewhere we will show that this scheme is more a pitfall in housing policy, than a solution for the problems in the housing market. After discussing the assumptions and ideas behind this policy (partly based on the British experience) and exploring the possible impact for the social sector, we will analyze to what extent all tenants are inclined to buy their own house. It will be shown that the amount of potential buyers is much smaller than presumed. Also, the price that they are willing and able to pay is much lower than assumed. Moreover, the research gives insight in the degree in which a specific groups of tenants, so-called ìscheefwonersîù (middle income households in relatively cheap dwellings), are inclined to buy their house and consequently fill the gap between the rental and owner occupied sector. Next, we will go into the impact of the sell out on the portfolio policy of the housing associations involved. At the end, we will propose an alternative approach for the right-to-by-scheme that fits better with the needs of the potential buyers and supports a sustainable portfolio policy more adequately.