The Right to Buy scheme is something that has been around for many years, and it’s all about giving council tenants the chance to own the home they’ve been renting. Imagine if you’ve been borrowing something from someone for ages, and then one day, they say you can buy that thing for yourself, and maybe even at a discount. That’s what Right to Buy does but for houses and flats instead of toys.
What is the Right to Buy Scheme?
Right to Buy was introduced in the 1980s in England to help people renting their homes from the council or housing associations to buy them at a lower price. Up until November 2024 and under rules set by the previous Governments, qualifying local authority housing tenants were able to purchase their property under the Right to Buy Scheme from discounts of up to £102,4000 across England, and £136,400 in London Boroughs.
Following the budget announcement, these discounts were returned to pre-2012 levels (more details below). Whilst there were transitional periods, at the time of writing this article, those transitional time frames have run out and therefore, with view to not cause any confusion over current rules, we will not discuss those here.
If you’ve been living in a council house or flat for at least three years (though it doesn’t have to be three years in a row), you might qualify. The idea is that you get a discount on the property’s market value, which makes it easier to afford.
The amount of the discount depends on how long you’ve been a tenant. For example, if you’ve lived there for five years, your discount might be bigger than someone who’s only been there for three. If it’s a house, you could get a discount of 35% if you have been a public sector tenant for between 3 and 5 years. After that, you receive a 1% for each year you’ve rented, up to a maximum discount. The maximum discount is 70% of the value of the property or the maximum discount for your region. For flats, the discounts can be even higher.
Once you buy your home through Right to Buy, it’s yours to keep or sell. However, if you sell it within a certain period of time (typically, the first five years), you might have to pay back some or all of the discount. It’s a bit like if someone gives you a big gift but says, “If you don’t keep it for a certain amount of time, you’ll have to give part of it back.”
What Should You Do if You Want to Use Right to Buy?
If you’re thinking about using the Right to Buy scheme and apart from choosing a right to buy conveyancing, there are a few steps you should take to get started:
- Check if You’re Eligible: First, find out if you qualify for the scheme. You need to have been a tenant for at least three years, and the property has to be your main home. If you’re not sure, you can ask your landlord or look online for the government’s Right to Buy eligibility checker.
- Work Out the Costs: Even with a discount, buying a home is a big financial commitment. You’ll need to think about whether you can afford the mortgage payments, as well as other costs like conveyancing fees. It’s a good idea to speak to a mortgage advisor who can help you figure out what you can afford.
- Get Professional Advice: Buying a home is a big step, and it’s important to get the right advice. Speak to a solicitor who specialises in right to buy conveyancing (that’s the legal process of buying a home). They’ll help you with all the paperwork and make sure everything is done properly.
- Apply for Right to Buy: If you decide to go ahead, you’ll need to fill out a Right to Buy application form. Your landlord (who is the Local Authority) will then let you know if you’re eligible and how much the discount will be. If you’re happy with the offer, you can move forward with buying the property. As you would imagine, this is an over simplified explanation of the application process and one that a conveyancing solicitor usually does not participate in. If you require assistance during this step, the Gov website has a number of very useful guides which explains each of the steps. You can find the link to the relevant site here.
- Think About the Future: Once you own your home, it’s yours to do with as you please. However, remember that you’ll be responsible for all the costs that come with owning a property, like repairs and council tax. And if you decide to sell it within five years, you might have to pay back some of the discount.
Final Thoughts
The Right to Buy scheme can be a fantastic opportunity for tenants to own their own homes, especially with the proposed changes that could make it even more accessible. However, it’s important to do your homework and make sure it’s the right choice for you. Take your time, get professional advice, and make a decision that works for your financial situation and future plans.
If you’re unsure about anything, don’t hesitate to speak to a conveyancing solicitor who can guide you through the process. Remember, buying a home is one of the biggest decisions you’ll ever make, so it’s worth getting it right.
Please note that the information on this blog is intended to be general information. No degree of reliance should be placed on this information and we can accept no liability in this respect. You must seek independent, specialist legal advice, specific to your personal circumstances before making a decision.
