Harrow Borough Council spends up to £500,000 a year renting homes it used to own for people in social housing.
Research from the authority shows it is renting 35 properties sold under the Right to Buy scheme, with landlords pocketing £350 a week for a four-bedroom house.
The council is therefore spending nearly half a million renting back homes it was forced to sell.
Cabinet member for housing Cllr Glen Hearnden said: “It is an expensive irony that the much-lauded right to buy has ended up as a financial straitjacket for Harrow residents.
“It really does not make sense to pay huge amounts of money to private landlords for houses we used to own."
“We haven’t built a council house for the past 23 years, which has further intensified pressure on our housing stock, with the London rental market going through the roof.
“It all adds up to our residents suffering. It feels like we are fighting the fires caused by an overheating housing market whilst the Government is stood on our hosepipe."
Last week it was revealed the council would have to move up to 50 homeless families out of London because it can no longer afford to keep them in emergency accommodation.
This is also due to a shortage of social housing in Harrow, which has 5,000 properties under authority control, one of the lowest stocks in London.
Projects are in the pipeline to ease the pressure on social housing, with the council announcing plans for the major redevelopment of the Grange Farm Housing estate.
This will include the demolition of 240 ageing homes and the building of more than 430 new properties on the site in South Harrow.