Most housing association tenants have the Right to Acquire, which means that they have the right to buy their home from their housing association at a discount, provided they can meet the criteria.

Criteria

The criteria for tenants to qualify to Right to Acquire include having had a public sector landlord for at least the last 3 years.  The landlords in this category include; Housing Associations, Councils, Armed Services, and NHS Trusts and Foundation Trusts.

You need to also make sure that your property is an eligible property, and your landlord must be registered with Homes England.

Eligible properties include:

• A property that has been built or bought after 31 March 1997.
• Properties funding by a grant for social housing provided by either local authority or Housing Corporation
• Alternatively, properties transferred to a housing association from the local authority after 31^st March 1997
• The property must be self-contained and your main residence

Joint Applications

If you are applying with someone else, you can make a joint application.  This must either be with someone who shares your tenancy, or it can be with up to 3 family members who’ve lived with you for the past 12 months even if they are not on the tenancy.

People who will not qualify for this right include someone who is being made bankrupt, someone who has received a court order to leave your home and, if you are a council tenant, if you have a preserved ‘right to buy’.

How do you apply for the right to acquire?

You must complete form RTA1 or you can ask your housing association for a form.  You may want to instruct a solicitor to help you understand these forms and make sure that you are filling them out correctly.

Through the right to acquire the housing association must send you written notice which sets out;

• The terms and conditions of the sale.
• The market value of the property.
• The discount you will get and how this is calculated.
• Estimates of any service charges you will have to pay.
• Finally, any structural problems that the council is aware of.

The process allows your housing association the chance to buy either your existing property or another property.

Once they receive your application, the housing association has certain deadlines it must meet to tell you if you are eligible depending on the property type. For a flat they must tell you within 12 weeks if you are eligible.  For a house the deadline is within 8 weeks.

Before deciding whether to buy your property, consider how long you are likely to want to stay there.  If in the future you decide to sell the property you have bought under this scheme, you may need to repay some or all of the discount if it is within the first 5 years after buying it.  This can also apply if the property is repossessed by your mortgage lender during the same period. The amount you will have to repay depends on how soon after buying it that you sell the property.

Ineligible properties

Not all housing association properties are eligible for the right to buy scheme.

The following properties do not qualify for the right to acquire;

• If it’s not self-contained
• If it is sheltered housing with service provision
• If it’s designed or adapted for people with special needs.
• If it’s provided as part of your job (for example, if you are a caretaker).

If you live in one of these categories of housing, and the association refuses your application to buy it, they must explain why it has been refused, and you will have no right to appeal this decision.

But all is not lost.  If you do not qualify for the right to acquire you may have the right to buy, which is a scheme that the government introduced in 2018.  Alternatively, you may have the preserved right to buy if you were previously a council tenant.  Take legal advice if you are not sure what options are available to you.

Buying Process under the Right to Acquire

The process is still the same as if you were buying from any other property owner, so you will still need to appoint a solicitor to act on your behalf, especially if you are buying with a mortgage, as your mortgage company will insist on having everything checked over by a legal adviser.  If you want to know more about this process, read one some of our other articles about property purchases.

Once you are happy with the terms of the offer you will need to confirm that you would like to go forward with the purchase in writing to your landlord. At this stage your solicitor and landlord will handle everything, and you will be required to sign various documents at different stages. Timescales can vary and can also depend on whether you’ve already got your solicitor and mortgage in place. At any point if you are unsure, and what to get an update don’t be afraid to call someone to find out.

You’ll need to organise your mortgage and it is advisable to get an independent survey from a qualified surveyor. The lender will arrange a survey but this only confirms the value of the property and doesn’t include a thorough check for any structural issues for example.

You will also want to appoint a solicitor to help the whole process run smoothly. They will deal with all the legal aspects and make sure you are getting everything you need to get done on time. You should always ask how much they will charge before instructing them. It might be a good idea to visit the law society website to find information on how to find a solicitor and to see what they will do on your behalf and to familiarizes yourself with the types of documents you can expect throughout.

As soon as you confirm with your landlord you want to proceed, they will prepare and send all the legal documents to your solicitor. Your solicitor will check over al these documents and reports and highlight any issues to you, so you don’t have to worry about picking out the issues your solicitor will worry about this for you. Once you’ve ironed out any issues with the lease and mortgage, the purchase will proceed.

At this stage you are still not committed to the purchase and can still change your mind. But at this stage costs will start in relation to your solicitor etc.

Once you have approved all the terms the purchase will be finalised, and completion will occur on a mutually agreed date. If you are paying a deposit, make sure this money is with your solicitor before the agreed date.

Your solicitor will take the money from your lender and any other money being used for the purchase and pay it to the appropriate parties on or shortly after the date of completion.  This will include all costs, Land registry fees, stamp duty land tax and legal fees. Your solicitor makes these payments on your behalf and handles all the movements of money.

On the date of completion, you must also make sure all rent due is paid to your landlord as if you are in rent arrears the purchase will not go through. Once completed your landlord will end your rent account and you will officially become the legal owner of your home!

Disclaimer – our articles are designed to give you guidance and information.  There is no substitute for proper direct advice, particularly as everyone’s circumstances are different.  If anything in this article may affect you, please contact us for advice that is specific to your circumstances.