What is the right to buy scheme?
The Right to Buy scheme enables public sector tenants to purchase their property at a price lower than its full market value, because of the length of time they have spent as a tenant. You will be a public sector tenant if you rent your home from a public body such as a council or government department.
Former local authority tenants who were living in their home when the council transferred it to another qualifying landlord (such as a non-charitable housing association) also qualify. This is sometimes referred to as a ‘preserved’ right to buy.
Am I eligible?
To be eligible for the Right to Buy scheme you must have been a secure public sector tenant for at least five years, although this does not have to be with the same landlord or in the same property, and it doesn’t have to be continuous either. You may be able to count time that your wife, husband, or civil partner was a public sector tenant towards the five year period, and if you lived with your parents after you reached the age of sixteen and later became a tenant, you might be able to count that time too.
You are entitled to make your application jointly with another person that shares your tenancy and/or up to three members of your family who have been resident at the property for the past 12 months, regardless of whether or not they are named on the tenancy. It is a condition that you and any other applicants have no legal issues with debt and do not have any outstanding possession orders.
The property that you want to buy must be your only or main home and must be self-contained. If it is sheltered or other housing that is suitable for elderly or disabled people, it will not be eligible.
How much discount will I get?
The amount of discount that you will be entitled to on the market value of your property depends on three things:
- How long you have been a tenant with a public sector landlord
- The type of property that you want to buy (house or flat)
- The property’s value
Up to 60% discount is currently available, capped at £75,000 (£100,000 in London boroughs), although this is expected to increase to 70% in April 2014 with the £75,000 cap also starting to increase in line with the Consumer Price Index rate of inflation. The discount is sometimes lower if you have used the right to buy scheme in the past.
You can sell your property after you’ve bought it using the Right to Buy scheme, but you will usually have to repay some or all of the discount that you were awarded if the sale takes place within five years.
How do I get started?
If you intend to exercise your right to buy, it is highly advisable to seek professional guidance early on – and you should be aware that not all conveyancers are experts in this area. The Right to Buy scheme is not like an ordinary conveyancing transaction and sadly, there are currently thousands of Right to Buy negligence cases stacking up, with many practitioners accused of failing to advise their clients properly over both conveyancing and mortgage issues. It is important to find a specialist solicitor with the necessary experience and expertise to help you navigate through the process of buying your home under the Scheme.
At Breens, our conveyancing team have helped hundreds of tenants to purchase their homes on the Right to Buy scheme. We are specialists in the full range of Government affordable housing programmes and we offer you practical legal advice at all stages to ensure that your transaction goes smoothly.