Buying out an apartment or house from the Council in the UK

In today’s article, we’ll learn about the Right to Buy program, which allows a favorable buyout of council housing in the UK.

The Right to Buy program allows you to buy a house or apartment from the council.

Under the Right to Buy program, some tenants of homes and social housing in the UK can buy the properties they live in at a significantly reduced price. In recent years, the government has tried to spread the program by loosening the eligibility criteria. This article explains how the program works - you’ll learn about whether you can get public support and how much it will be.

Since the program does not apply to Scotland and Wales and the information in the article applies only to England and, to a lesser extent, Northern Ireland.

Buying out an apartment or house from the Council in the UK - conditions

In order to take advantage of the program, you need to meet several conditions. On the government’s Find out if you’re eligible for Right to Buy website we find an online tool with which you can quickly check if you have a chance to benefit from the program.

Generally, you can buy a house or apartment from the council in the UK if:

• It is your only, or main home or apartment - you must be a permanent resident of the property in question;

• The property is self-contained - this means that you do not share any rooms, such as a kitchen, bathroom or toilet, with people outside your household;

• You are a so-called secure tenant - there is a contract between you and the landlord governing the lease;

• You have been renting a house or social housing for at least three years ;

• You have no debt problems;

• The house or apartment you live in is not slated for demolition.

You can make a joint application with:

• A person who shares a lease with you;

• Up to three family members who have lived with you in the past 12 months (even if they do not share a lease with you).

Buying an apartment from the council is therefore possible for the vast majority of tenants of social properties. The program’s criteria are, in our opinion, quite liberal, especially when you look at the value of the assistance provided.

Why buy an apartment or house from the Council?

Those who qualify for Right to Buy can get a discount on the market value of the home they live in. Currently, the largest possible discount is £102,400 across England and £136,400 if you live in London (source: GOV.UK). These amounts are indexed for inflation every April.

The amount of the discount depends on several factors. The factors taken into account are:

• Whether you live in a house or an apartment;

• How long you have been a tenant.

For example, if you have lived in your home for three to five years, you will get a 35% discount on the market value of the property, but it will be no more than £102,400 / £136,400. If you live in a property worth £200,000 using the program you will get no more than £70,000, but if you live in a house worth £500,000 you will get no more than £102,400, or £136,400 if you live in London.

If you rent an apartment, your situation is even more favorable. If you live in a social housing unit for three to five years, you will pay **up to 50% less **for it, with the aforementioned amount limits still in place. So if you use a social housing unit worth less than £204,800, you can own it for half the market value!

We feel that the numbers speak for themselves - the buyout of an apartment from the council in England is extremely beneficial and no one needs to be convinced :)

Mortgage when buying an apartment or house from the Council

Although buying an apartment from the council is much cheaper than buying a property on normal rumps, you will probably still need a mortgage to finance it. The responsibility for arranging the mortgage lies with you, and the entire procedure follows the same rules as for buying a standard house or apartment.

Therefore, you are cordially invited to make an appointment with us for a free, no-obligation consultation with one of our loan advisors. Extend Finance is a company with many years of experience in the market, we have also been involved in financing buyouts of social properties. Using our services, you are sure to find mortgage offers tailored to your needs. We are also sure that thanks to us, you will not overpay for your home.

On our blog there are great guides from which you will learn what is a mortgage and how is the process of buying property in the UK. Read: buying an apartment step by step.