Many individuals in the UK live in council housing and have done so for many years. In recent years it has become increasingly popular for families in council homes to buy their properties. Not only are they much cheaper to buy than other properties, but it completely eliminates the hassle of finding a new home and moving your family.
If you are living in a council property and are thinking of purchasing it as your own, then there are a few things you should know. This guide explains how to buy your council house and some top tips to make the process a little easier on you and your family.
What Is Right To Buy?
If you have been looking into buying your council house, then the chances are you have come across the phrase ‘Right to Buy’. Right to Buy was introduced back in 1980 and gives council tenants the right to purchase their council property at a discounted price. There are some rules and regulations in place, and it is vital to make sure you are eligible for Right to Buy before you consider it as an option. You will be able to apply to buy your council home if:
- It is your only home and main place of residence
- It is self-contained and not a shared property. This means you cannot be sharing a kitchen or bathroom with anyone outside of your household.
- You are a secure tenant, and there is a legal contract between you and the landlord of the property.
- You have had a public sector landlord, such as the council, for three years.
It is possible to make a joint application to the Right to Buy scheme with someone who currently shares your tenancy. You can also make a joint application with up to three family members that you have lived with for at least 12 months, even if they are not on the tenancy.
What Discount Can You Get?
With Right to Buy you could be eligible for a discount on your council home, and the amount of discount you can get depends on the type of property you live in.
If you live in a house, then you can get a 35% discount as long as you have been a tenant in the property for between three and five years. After five years the amount of discount you can get increases by 1% for every extra year you have lived in the house, up to a maximum of 70% or £103,900 in London and £77,900 across the rest of England.
If you live in a flat, you can get a 50% discount on buying the property if you have lived there for between three and five years. After five years, the discount will increase by 2% for every extra year you have been a tenant for, with the same maximums as buying a council house.
The length of time you have lived in the property will have a significant impact on the amount of discount you can get, and the amount you can purchase your home for. For example, if you have lived in a £100,000 flat for ten years, you could be eligible for a 60% discount and buy your flat for only £40,000.
How Does Right To Buy Work?
If you think you are eligible for Right to Buy and want to purchase your council property, then firstly you will need to complete a Right to Buy application form. This form should be sent to your landlord, and it this stage they can decide if they want to sell you the property. If your landlord agrees to the sale, then they will send an offer that includes:
- The price they think you should be paying for the property and how they worked it out.
- The discount you are eligible for and how it was worked out.
- A full description of the property in question, as well as any land that is included.
- Estimate amounts for any service charges involved for the first year (this is usually for flats or maisonettes that are in shared buildings).
- Any problems that they are aware of with the structure of the property, such as subsidence.
If you decide to go ahead and purchase the property, then you need to work out how to finance the property yourself such as through a mortgage or other borrowing method.
Buying a property is a very big decision that will affect your finances for the rest of your lifetime. Think carefully about if it is the right step for you and consider if you can reasonably cover all the costs involved. See Right to Buy Mortgages on Lending Expert for further details on how to fund the purchase of your home.