Discounts offered under the Right to Buy scheme will be reduced, the Chancellor confirmed in her Autumn Budget speech.
Rachel Reeves revealed she would also change the rules so local authorities can keep the money made from selling homes through the scheme to reinvest in social housing.
It follows her announcement ahead of today’s speech that the Government would invest £500 million in building a further 5,000 social homes.
And she said today the government would consult on higher rents for social tenants to provide providers with longer-term financial stability.
She said: “We will implement the right policies to increase the supply of affordable housing. After hearing protests from local authorities, social housing providers and from Shelter, I can today confirm that the Government will reduce Right to Buy discounts and local authorities. will be able to keep the full proceeds of whatever so that we can reinvest them back into the housing stock and into the new supply.
“By doing this, we will give more people a safe, secure and affordable place to live.”
Right to Buy discounts currently offer council tenants up to 70% off their home purchases.
Last year, 10,896 homes were sold through Kooprecht, while only 3,447 were replaced.
However, the Chancellor also confirmed that she would pave the way for social landlords to increase rents.
She said: “We will provide stability to social housing providers with a social housing lease of CPI plus 1% for the next five years, and we will deliver on our promise to hire hundreds of new planning officers to get Britain built .”
Chief Commercial Officer Ryan Etchells said in a joint statement: “The Chancellor’s reduction in the rebate that allows tenants to buy their social housing under Right to Buy means that in most cases they will have to pay tens of thousands of pounds more to get ahead . the housing ladder.
“The government says this will make the scheme ‘fairer and more sustainable’, but the move seems incredibly unfair as some people who may have lived in their social housing for years and intended to make it their own are now simply will be locked out of homeownership forever.”
Housing charity Shelter has previously warned that trying to increase the stock of social housing without reforming the Right to Buy is like running a bath without plugging it in.
In the 44 years since the plan was launched under Margaret Thatcher, more than two million homes have been sold to more than 4.5 million sitting tenants.