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The scottish executive's proposal to extend the right to buy to tenants of registered social landlord predictably provoked howls of outrage in the run-up to the introduction of the Housing (Scotland) Act 2001.

Despite this, the proposal passed into law when the act was brought in on 30 September 2002. But largely to appease objectors, the executive did take a number of steps to dilute the immediate impact of the measure. In fact, the 2001 act also created powers that councils could invoke to rein in the right to buy that their tenants already enjoy.

Wait for it
For RSLs, the main concession is that the tenants' new right to buy will not actually come into force until September 2012 – except for residents who have a preserved right to purchase after a stock transfer or in the case of houses built after the act came into force in September 2002.

The executive's rationale is that this 10-year moratorium will give RSLs the time to adapt to the implications of having to sell homes. Also, in 2012, if an RSL is concerned that sales of its stock will threaten its financial viability, it can apply to ministers for a further suspension of up to 10 years.

Should they so wish, RSLs can elect to bring in right-to-buy sales before 2012 – though it is difficult to see why they would want to do this.

Existing charitable RSLs were also made exempt from the new rules – again, unless their tenants have a preserved right.

The rights enjoyed by tenants have also been restricted in several ways. The length of time they've been living in their home that allows them to qualify to buy the place has gone up from two to five years; the maximum discount percentage has been reduced from 70% to 35%; and the maximum discount allowed in cash terms has been limited to £15,000.

Tenant cannot apply for the right to buy if they have rent or council tax arrears, nor can they buy if their landlord has commenced proceedings for recovery of possession on grounds of conduct – a measure that supports the executive's wider fight against antisocial behaviour.

Also, to avoid exacerbating the problems involved in regenerating multi-tenure estates, tenants cannot exercise the right to buy their house if it has been earmarked for demolition. Thus social landlords should be able to avoid having to buy out owner-occupiers or situations where purchasers don't have the cash to participate in a regeneration scheme.

The act’s concessions simply delay the inevitable problems that will result if significant numbers of houses end up leaving the social rented sector

Pressure points for councils
For councils, however, the introduction of "pressured area" status is the big news – and South Ayrshire council has recently become the first Scottish local authority to apply for this categorisation (HT 18 June, page 13).

If a council is deemed a pressured area, it will be able to suspend the right to buy, within the boundaries of the area, for up to five years. In theory, a council can go on applying for consecutive five-year suspensions once one period runs out.

This route is only open to councils and it requires them to make a successful application to ministers asking for all or part of an area within its charge to be categorised as pressured. The council will have to convince ministers that:

• the need for social rented housing, provided by both the council and RSLs, does, or is likely to, exceed the available housing
  
• the right to buy is likely to exacerbate this situation.

Although a number of councils have talked about seeking this status, South Ayrshire is the only one to have applied to the executive so far. South Ayrshire has lost 40% of its stock through tenants buying their homes and has one of the lowest levels of social housing in Scotland.

The council sold 500 right-to-buy houses last year and needs to build another 405 to meet existing need. A decision is pending from the government, but it is difficult to see how the application can be refused in these circumstances if the pressured area exemption is to have any meaning.

If the designation is granted, other local authorities may follow suit – Fife council has already intimated that it is preparing a submission for the executive.

But pressured area status is not a panacea. Crucially, it essentially suspends purchases only of those who became tenants after September 2002 and does not prevent those who were awarded a right to buy before the 2001 act. South Ayrshire calculates that it will only save about 53 houses.

The new legislation puts Scotland some way ahead of England in terms of tightening up on the issues surrounding right to buy – at least for a time.