I live in a council house; do I have the right to buy it?

The government's Right to Buy scheme has expanded in recent years, allowing an increasing number of people who rent council homes to purchase them.

The inclusion of a generous price discount is a key benefit of the scheme, but who can take advantage of Right to Buy and what rules and restrictions apply?  

Who is eligible to use the Right to Purchase?

The Right to Buy scheme has been in place for over 40 years and is primarily concentrated in England, having been repealed in Scotland and Wales.

It is still in operation in Northern Ireland, but the scheme will be drastically reduced there soon.  

So, what are the requirements for qualification?

If you meet the following criteria, you can apply to buy your council home:

• The property you wish to purchase will be your sole or primary residence.

• Your house must be self-contained, with no rooms shared with people other than your family.

• A legal contract between you and your landlord will be required to make you a secure tenant.

• You must have had a public sector landlord for at least three years, though not necessarily consecutively. A council, housing association, or NHS trust is an example of a public sector landlord.

• It is critical that you have no debt-related legal issues, such as a county court judgment.

You can still make a joint application if you share your tenancy, and you can also apply with up to three members of your family if you've lived together for the past 12 months.  

How do you apply for the Right to Buy?  

If you want to buy a council house through the Right to Buy scheme, there are four major steps you must take.   

Step 1 To begin, you must fill out an RTB1 application form. If you click on this link, you will get all of the information you need and instructions on what to do next.  

Step2 Then, send your completed RTB1 application form to your landlord. Print it, sign it where necessary, and send it by recorded delivery to ensure that your landlord has received it.  

Step 3 Wait for your landlord's response. They must notify you within four weeks of your application if they are willing to sell, or eight weeks if they have been your landlord for less than three years. If the answer is no, please explain why.  

Step 4 If your landlord agrees to sell, he or she will make you an offer. This must be sent to you within eight weeks if you are purchasing a freehold property, or 12 weeks if you are purchasing a leasehold property. The offer will include a price and how it was calculated, your level of discount, a description of the property, estimates of any service charges for the next five years, and any known structural problems with the property.  

You'll have 12 weeks after receiving the offer to decide whether to proceed, and you can cancel the sale and continue renting if you change your mind.  

What about getting financing for your purchase?  

Naturally, you'll need to secure a mortgage in order to purchase your council home.

Do some research to determine which type of mortgage is best for your circumstances, and consult a professional financial or mortgage adviser before making your final decision, as this is a big step.

Other costs to consider when becoming a homeowner include repairs and maintenance — things that were not your responsibility as a tenant.   

Remember that Stamp Duty is a tax that you must pay when purchasing property or land in England or Northern Ireland. The amount will be determined by the value of your home.

Your solicitor can advise you on Stamp Duty and how much you'll need to pay, or you can consult an expert financial adviser.    

What is the Right to Buy discount?  

The discount you can receive is a significant benefit of the Right to Buy scheme.

The size of your discount is determined by whether you live in a house or a flat, where you live in the country, and how long you have been a public sector tenant.  

For example, if you've lived in a house for three to five years, you'll receive a 35% discount, so if your home is worth £200,000, you could get £70,000 off with Right to Buy, so you'd actually pay around £130,000.  

If you've been a public sector tenant for more than five years, your discount increases by 1% for each year after that, up to a maximum of 70%, or £87,000 This maximum is £116,200 in London.   

The figures for flats differ. If you've lived in your flat for three to five years, you'll receive a 50% discount, so if your property is worth £140,000, you could get it for less than £70,000.

After five years as a public sector tenant, this discount grows by 2% per year, up to a maximum of 70%. Discounts on houses are capped at £87,000 and £116,200, respectively.  

Keep in mind that if your landlord has spent money on construction or maintenance, your discount may be reduced.  

What limitations may apply?   

Because of the status of your home, you may not always be eligible for the Right to Buy scheme.

For example, it could have been a council property that was sold to a different public sector landlord while you were living there.

You may still be able to purchase a home through Preserved Right to Buy, but you must meet all of the usual Right to Buy criteria in these circumstances.  

You may not be eligible for Right to Buy or Preserved Right to Buy. You may be able to apply for the Right to Acquire scheme in this case. This allows many housing association tenants to buy at a reduced price of up to £16,000.

Eligibility is similar to Right to Buy, but with a few additional components. Your home must have been built or purchased by a housing association after March 31, 1997, or it must have been transferred from a local council to a housing association after March 31, 1997.

More information on how to apply can be found at Gov.uk.  

Getting the right financial advice for your situation is critical. Find your ideal financial advisor right now.  

I'd like to speak with a mortgage advisor.