Right to Buy: Boris Johnson Reveals Plans to Revive The Scheme
U.K Prime Minister, Boris Johnson, has indicated a desire to extend the current Right To Buy Scheme by giving people who rent their homes from a housing association the chance to buy the property at a discounted price of up to 70%.
This could be welcome news for those who consider themselves a member of ‘generation rent’ (young adults generally aged between 18-40), in their quest to get a foothold onto the property market and away from rising monthly rental premiums.
If this proposal moves forward, it could pave the way for up to 2.5 million households in England, who currently pay rent to housing associations, to be included within the Right To Buy scheme.
In conjunction with this initiative, consideration is also being given by the government to gain agreement from mortgage lenders to accept housing benefits as part of the overall affordability calculation when assessing an application in order to secure the mortgage needed to complete a purchase.
Online Mortgage Advisor’s managing director, Pete Mugleston, said of these proposed changes to the Right To Buy scheme: “This could, potentially, be very welcome news for anyone who sees their chances of ever owning their own home slipping away. The Right To Buy scheme is an excellent opportunity for people to get their foot firmly on the property ladder and the mortgage brokers we work with will be keen to assist whenever called upon.”
When the Right To Buy scheme was originally introduced in 1980 by Margaret Thatcher, it was designed only to cover purchases for council owned properties, which made up almost all forms of affordable housing. The policy would prove to be a resounding success during the 1980s.
However, it did create a shortage in social housing for those on lower incomes which has since been filled mainly by private housing associations. Plans to revive the Right To Buy scheme by including housing association owned properties have been attempted previously, with pilot schemes running in 2016 and 2018.
The current Conservative government is now hoping to breathe further life into the housing market by honouring a pledge made in their 2019 manifesto to help people further down the income scale buy their own home.
If you’d like to know more about how the Right To Buy scheme works, take a look at our in-depth guide for all the information you need