The new housing measures are designed to help first time buyers
23 January 2022 12:00 AM

Right to Buy

23 January 2022

What is the Right to Buy?

“Right to Buy” is a scheme under which longstanding local authority tenants are entitled to purchase their homes at a heavily discounted price.

To be eligible to participate in a ‘right to buy’ scheme, it must be the tenant’s only or main home with them as a secure tenant, it must be self contained, and the tenant must have had a public sector landlord such as a council, housing association or NHS trust, for 3 years. The 3 years do not currently need to be consecutively.

The Right to Buy scheme currently only operates in England and Northern Ireland. The Scottish National Party in the Scottish government abolished the scheme in Scotland in 2017. Similarly the Labour Party in the Welsh government abolished the scheme in Wales in 2019.

The Northern Ireland version of the Right to Buy scheme will be abolished for housing association tenants in August 2022.

There had been 1.98 million Right to Buy sales in the period between the start of the scheme in 1980 and the end of March 2020.

How much is the Right to Buy discount?

The longer someone has been a tenant, the bigger the discount from the market value that they are entitled to. Discounts are calculated differently for houses and flats, and in 2020 ran up to a maximum discount of £84,200 or £112,300 if someone lives in London. The maximum discount figures increase each year with the Consumer Price Index.

With local authority homes, tenants receive a 35% discount if they have been a public sector tenant for three years. The discount remains at 35% until someone has five years public sector tenancy. After five years, the discount goes up by 1% for every extra year that someone has been a public sector tenant. The discount caps out at 70% or when the maximum discount total is reached.

With local authority flats, a tenant is entitled to a 50% discount if they have been a public sector tenant for three years. The discount remains at 50% until five years of public sector tenancy is reached. After year five, the discount then goes up by 2% for every extra year until the maximum of either 70% or the total discount value is reached.

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