The Government could inject more than £68bn into the UK economy by extending right-to-buy opportunities to housing authority tenants, according to one of the UK’s largest registered landlords.

Home Group, which has more than 50,000 properties across England, Scotland and Wales, has today released figures which show the construction catalyst that a change in legislation would bring.

Mark Henderson, Home Group chief executive, said: “When the Government published its Housing Strategy at the end of 2011, improved right-to-buy opportunities for council tenants were at its heart. Home Group highlighted then that a far more seismic economic impact would be felt if the same opportunity was extended to housing association tenants providing we can replace a new property for each one sold.

“Updating the right-to-buy rules for housing association tenants not only offers individuals the same chance to become a homeowner as residents in council homes, it will give a phenomenal boost to the UK economy.”

Current right-to-buy rules are blocking an estimated one million housing association tenants (source: IPPR) from buying their own properties. Based on historic data of local authority right-to-buy sales over the past 10 years, 1 in 5 of these would potentially look to buy their own home.

In its Housing Strategy, the Government stipulated that landlords would need to build a new property for every home sold. With the average new housing association property costing £120,000 to build (Bevver and Struthers 2011 Annual Review of Social Housing), and an estimated 200,000 new homes being built to replace the properties sold, this would see £24bn spent directly in the construction sector. The Confederation of British Industry (CBI) has previously calculated that every £1 spent in construction was worth £2.84 for the economy. On this basis, extending right-to-buy to housing association tenants would be worth £68.2bn a year.

Mr Henderson added: “There is clearly work still to be done on understanding how we can replace each sale with a new property but this is not an insurmountable problem. The key element is tenants having the necessary deposit when seeking a mortgage. Government could facilitate that through the use of the legacy debt that currently sits on housing authorities’ books, at no cost to the taxpayer. This way, we can make it easier for people to own their own homes, we can move the sector away from the reliance on Government grant and we can make it economically possible to replace sales on a one-for-one basis.”