Council staff are being swamped by people rushing to buy their homes as tenants seek to cash in on the housing boom.

In many areas, the number of applications to buy council-owned houses has doubled amid fears that the Government is about to radically overhaul the right-to-buy scheme.

Under the scheme, which was one of Margaret Thatcher's most popular policies, tenants can apply to purchase their home at a knock-down price and discounts can be as high as 70 per cent.

But critics claim it is exacerbating affordable housing shortages as tenants cash in on soaring prices.

Deputy Prime Minister John Prescott is planning to reform the 22-year-old scheme. It follows reports that some private companies are lending tenants the money to buy the houses before selling them on for a big profit. In the North-East and North Yorkshire, requests to buy council homes have soared.

Between 1980 and 2001, more than 84,000 council homes were sold to tenants in the North-East and 65,627 in Yorkshire and the Humber.

Applications to Derwentside District Council, which has a housing stock of more than 8,700, have almost doubled, with 301 applications since April this year, compared to 162 in the same period in 2001.

Council leader, Alex Watson, said: "The recent announcement by John Prescott on the possibility of removing the right to buy has created a landslide of applications."

Hartlepool Borough Council has also seen a surge. Officers used to dealing with around 150 applications a year have processed 120 already this year and have a further 320 waiting to be processed.

Elsewhere in the region, Middlesbrough has seen a jump of 79 per cent in applications this year, with 215 already processed, compared to 120 in 2001.

Darlington Borough Council reported a 50 per cent rise, up from 81 in 2001 to 125 this year.

In Stockton, there were 150 applications in last financial year compared with 234 since March this year. And at Sedgefield Borough Council applications have leapt, from 328 in 2001 to 569 so far this year.

Only Wear Valley District Council, which owns 5,500 properties, said there had been no rise in tenants applying to buy.

Homeless charity Shelter said the right-to-buy scheme was adding to the chronic shortage of affordable housing. Ben Jackson, Shelter's director of external affairs said: "With one hand the Government is giving away billions of pounds along with the nation's stock of affordable housing. "