Right to Buy: the government’s plans

Ever since the 1980s, there have been various govern-driven schemes to allow those living in rented council accommodation to purchase the home for a reduced rate from the market value of the property. This has given many a council tenant the ability to step on to the property ladder with better financial backing than would otherwise have been the case.

While these discounts have been beneficial to the individual, the scheme has also opened up the possibility of those tenants buying their own home and then selling it almost immediately, taking advantage of the instant extra equity created by selling the home for the market value - critics might point out that, since they have been paying for rent for a few years, it's their right.

In recent days, there have been reports that the new Government, in place since July 2024, wants to shake up the terms and conditions under the provisions of the Right to buy scheme.

As the name suggests, Right to Buy is the latest government-led scheme that gives council tenants the opportunity to buy the home that they have been renting.

There are some obvious caveats before applying for its purchase: the home must be self-contained and be the tenant's only home, with the additional requirement of having a secure tenancy - that is, the right to live in the property for the rest of their life.

When a tenant wishes to buy their property, the council will offer a discount on the market value of the property, which depends on where it is in the country, the market value of the property, the type of dwelling (e.g. a flat, terraced, semi-detached, etc.) and how long the tenant has been paying rent to a public sector landlord (usually the local council).

The discount that applies is calculated dependent on the duration of the current tenancy: this is presently 35% (for houses) or 50% (for flats) if the tenant has been residing there for 3 to 5 years, after which it increases by 1 percentage point (houses) or 2 percentage points (flats) for each subsequent year of living there. This is up to a maximum of either 70% of the market value of the property or the maximum discount for the region (whichever calculation is the lower) - the details on those maximum figures can be found here.

This means that, for any tenant wanting to buy their property, they should have a length of tenure in the property before they become eligible. 

Following the Autumn Budget 2024 announced at the beginning of November, there is a consultation period currently running regarding what should be done to beef up the scheme and its management.

The details have been variously reported in the papers and online, but the principal reforms planned are as follows:

• Qualifying criteria - the current criteria are quite loose, according to the Government, so the plan is to look at ways of tightening it up.
• Discounts - the discounts as they are currently applied might be viewed as overly generous, giving a disproportional advantage to tenants against other first-time buyers when it comes to purchasing the property.
• Exemptions - looking at which types of property should be exempted from the scheme, and whether this definition should be expanded or narrowed.
• Restrictions - whether the controls over the sale of council properties should be enhanced.
• Stock replacement - without replacement of the public (such as the council) residential properties, the supply for those who need them will dry up, so understanding what needs to be planned to manage this outcome.

It should be reiterated that these changes are in the discussion phase with a consultation phase currently running until 15 January 2025.

Anyone can get involved with the consultation by completing online survey on Citizen Space, or, alternatively, you can email your response to the 25 questions in the Reforming the Right to Buy document to the specific email address at righttobuy.consultation@communities.gov.uk. Note that the questions are part of each section, which will require reading through the details first.

Wanting to get the best value for money when it comes to the conveyancing for your council house sale and purchase? You can rely on the experts at Homeward Legal to help you with a thorough job. 

They will start work on your planned purchase as soon as you agree to the quotation and appoint them to represent you. 

Homeward Legal will also provide a quote that will not change - what you are quoted is what you pay for standard conveyancing process, which means you can effectively budget for your conveyancing needs.

There are some unforeseen items that might arise during the purchase and/or sale, but the solicitor discusses these and their cost as they come up. 

In addition, to protect the homebuyer further, Homeward Legal operates a ‘no completion, no fee' promise, which ensures that, should the purchase or sale not go through as planned to completion status, no payment is required.

Call  to get your conveyancing quote started, or to discuss your concerns with your plans to move.

Or you can get a quick quote, using Homeward Legal's easy-to-use quote generator.