Can I Buy My Council House?

The Right to Buy scheme is a great way to get onto the property ladder if you’re a council tenant. It allows you to buy the property you’re living in at a significant discount. But can you buy your council house?

The answer for most council tenants is yes. However, there are specific eligibility criteria you must meet and not everybody living in a council house will be eligible for the scheme.

In this article, we will delve into the details of the Right to Buy scheme, examining who qualifies, the financial benefits involved, and the steps required to move from tenant to homeowner.

What is Right to Buy?

Right to Buy is a scheme introduced by the Conservative government in 1980 that allows council tenants to purchase their house at a discount. This discount is deducted from the cost of your house, meaning you might not need to use a deposit if the discount is greater than the deposit you’d need.

If you’re buying a house valued at £200,000 and receive a deposit of £80,000 through the scheme, this can be used as a deposit. Whether you need a deposit despite the discount might depend on your credit history and financial situation, with some lenders reluctant to lend to you if you have adverse credit for example.

Who is eligible?

The Right to Buy scheme is open to most council tenants in England and Northern Ireland, although the scheme has been abolished in Scotland and Wales. Here are some of the eligibility criteria you’ll need to meet:

• Your property is your only or main home
• You’ve been a tenant for at least three years
• You don’t have any legal problems with debt
• Your home is self-contained, with no rooms shared with anyone from outside your household
• You were a council tenant when your home was sold to your current landlord

For more criteria and to confirm whether you’re eligible, take this free quiz on the government website.

How do you apply for Right to Buy?

Once you’ve confirmed you have the right to buy your council house, you can now start your application. Here are the main steps you’ll need to follow:

1. To begin with, you’ll need to fill in an RTB1 application form. You can do this online with the link provided and print out your form once it’s completed or you can download the application form and fill it out by hand.
2. Once you’ve downloaded your form and completed it, you need to send it to your landlord. Make sure you’ve signed where necessary and send the completed form to your landlord via recorded delivery to ensure they receive it.
3. Once you’ve sent your application form to your landlord, they have four weeks to respond, or eight weeks if they’ve been your current landlord for less than three years. Their response should include eligibility confirmation and whether any legal issues might prevent the sale.
4. If your landlord agrees to sell, they will send an offer notice for houses (Section 125 Notice). This notice, which should arrive within eight weeks (or twelve weeks for flats and leasehold properties), includes the price you need to pay, how the price was determined, the discount you are entitled to, estimates of any service charges for the next five years and a description of any structural problems known to the landlord.

What discounts are available?

One of the best things about the Right to Buy scheme is the discounts you can access. This makes it much easier to buy your council house than it would if you’re taking out a fixed-rate mortgage, for example.

Here are some of the discounts you might be eligible for:

Type of Property

Depending on the property you rent, the type of discount available to you will vary. This is explained below.

• Houses: You can get a discount of 35% if you’ve been a tenant for between 3 and 5 years. After the initial 5 years, the discount increases by 1% for each additional year of tenancy, up to a maximum of 70% or a monetary cap, whichever is lower.
• Flats: You receive a higher starting discount of 50% for 3 to 5 years of tenancy, with the discount increasing by 2% per additional year, up to a maximum of 70% or the monetary cap.

Maximum Caps

The maximum discount you can receive is capped and will vary depending on where you’re located. The cap is linked to the Consumer Price Index (CPI) and increases every April.

Length of Tenancy

The discount increases with the length of your tenancy, so longer tenancies result in higher discounts, although the increased rate and the maximum cap limit how much discount you can receive.

It’s important to remember that your discount might be reduced if your landlord has made modifications to your house. To get a better idea of the discount you might receive use our Right to Buy calculator below:

Are there any restrictions?

As long as you fulfil the eligibility criteria listed above, you should qualify for the scheme. However, there are certain situations where you might not be able to buy your council house.

One such restriction could be the status of your home. If you were a council tenant when your house was transferred to another landlord, such as a housing association, this can be a problem. However, you might be eligible for the Preserved Right to Buy in this instance. This allows you to buy your council home in the same way as Right to Buy.

If you don’t qualify for Right to Buy or Preserved Right to Buy, you might be able to apply for the Right to Acquire scheme. This allows housing association tenants to buy the property they live in with a maximum discount of £16,000. The discount you receive will also depend on where you live, which you can see on the government website.

Your property must have been bought or built by a housing association after 3 March 1997 or transferred from a local council to a housing association after this date.

How a mortgage broker can help you

If you’re thinking of purchasing your council house through the Right to Buy scheme, a mortgage broker can help guide you through the process. Our unique broker-matching service will pair you with an advisor who specialises in Right to Buy mortgages.

Just call us on 0808 189 2301 or make an enquiry and we’ll do the rest. We’ll simply ask for a few details and from there can find the broker to suit – it’s completely free and there’s no obligation, just the chance to find the right lender with expert support at your side.