The Government's new Housing and Planning Bill plans to extend the right to buy scheme to housing associations (HA).
However, CIH analysis shows local authorities could be left with no money to replace the homes they are forced to sell to fund the policy.
The Bill also includes new legislation on the sale of empty high-value council homes.
Previously, ministers have said the generated cash would be used to replace both the HA and council homes sold, while also setting up a new £1bn brownfield regeneration fund.
Research by CIH shows:
• Between 2,100 and 6,800 'high-value' council homes are likely to become empty and be sold each year – compared to the government's estimate of 15,000.
• Sales would generate between £1.2bn and £2.2bn a year – compared to the government's estimate of £4.5bn.
-- Advertisement --
• Around 1.45m HA tenants would be eligible for right to buy during the first five years of the policy, with around 10% (145,000) likely to take advantage.
• £1.2bn would be around half the amount needed to compensate HA's for homes sold under the scheme – HA's would need almost all of the higher £2.2bn estimate, leaving nothing for councils to replace the homes they have sold or for the brownfield regeneration fund.
CIH Chief Executive, Terrie Alafat, said: "We support the government's ambition to give people the opportunity to achieve their aspiration of home ownership, but if affordable housing is being sold, it is absolutely crucial that it is replaced on the same terms. However, our research appears to confirm our fears that the figures simply will not stack up.
"Selling high-value council homes to fund the extension of right to buy to housing associations could result in the loss of almost 7,000 council homes a year, at a time when more and more people are in need of an affordable home. Such a significant loss of desperately-needed affordable homes would mean more people on lower incomes stuck on council waiting lists all over England – and for generations to come.
"The government should examine how to close this funding gap in the forthcoming spending review, so that both housing associations and local authorities are able to replace the homes they sell with new affordable homes to rent."
CIH suggested alternative methods for the government to close the funding gap, such as offering smaller discounts than those currently proposed or increasing the qualifying period from three to five years.
(LM/CD)
