Two Cambridge council houses have been put on the market for £700,000 and £600,000 respectively – prompting fresh fears about looming changes to right-to-buy.

The properties in Beche Road and Grafton Street are both listed on Rightmove for the astronomically high sums, with the city council having agreed to dispose of the properties back in June.

It also agreed to sell another property in Shelly Row which is expected to command a similar sum when it comes onto the market.

There is a well-documented shortage of social housing in Cambridge, and the city council insists it thinks long and hard about disposing of any properties.

Cllr Kevin Price, the city council’s executive councillor for housing, says the decision has to be balanced against the investment needed to bring it up to scratch for new tenants, as well as the funds any new home can generate.

It is hoped that selling these two properties will enable the council to build nine new two-bed homes.

“A further consideration in June was the Government’s proposal for compulsory sales of council homes over a set value to fund the extension of right to buy to housing associations,” he added.

“This would mean that the three properties would have to be sold – but the Treasury would get the money and not the city council.

“We estimate that under the new proposals the Treasury may get some £25 million a year from the forced sale of city’s council homes with no benefit to Cambridge.

“We expect to lose up to 125 homes every year, mainly badly needed one and two-bed homes as well as almost every bungalow across the city. Some wards like Market and Castle will lose every council home.

“These are not mansions but ordinary council homes which happen to be in high value areas.

“We need to see the final proposals from Government, but are determined to do everything we can, including a legal challenge, to fight them on behalf of our tenants.”

Early Government plans for extending right to buy to housing associations say it would be funded by forcing councils to sell-off ‘high value’ properties.

The proposals are yet to be finalised.

Details still to be worked out include whether these ‘high value’ homes are based on their market value or value on a council’s balance sheet, which can be as much as 40 per cent lower.

The matter is further complicated given rules around re-investing money the council currently gets from right to buy sales.

Under its current building plans the council has to find £20m of ‘match funding’ alongside its right-to-buy receipts in order to fund the building of new housing.

If the council fails to spend its right-to-buy money within three years it must return the money to government – with a hefty interest penalty.

A full assessment of the proposed impact of extending right to buy is due before the council’s housing scrutiny committee later this month.

Earlier this year the council threatened legal action against the Government over the proposed legislation.