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Guide to Right to Buy

Written by: Your Money
Right to Buy allows most council tenants who have lived in their council home for five years to buy it at a discount.

The maximum discount is £77,000 for anywhere in England, except in London boroughs where it’s £102,700. This figure will increase each year in April in line with the consumer price index (CPI). The size of the discount you qualify for depends on how long you have lived there, the value of the property and whether it is a flat or a house.

For houses you get a 35% discount if you’ve been a public sector tenant for 5 years. For every extra year you’ve been a public sector tenant, the discount goes up by 1%, up to a maximum of 60% – or £77,000 (whichever is lower).

For flats you get a 50% discount if you’ve been a public sector tenant for 5 years. For every extra year you’ve been a public sector tenant, the discount goes up by 2%, up to a maximum of 70% – or £77,000 (whichever is lower).

Your landlord must complete parts of your Right to Buy application within set time limits. If they don’t, you could get a reduction in the sale price.

Selling your property

If you sell your home within 10 years of buying it through Right to Buy, you must first offer it to either your old landlord or another social landlord in the area.

If the landlord doesn’t agree to buy your home within 8 weeks, you can sell it to anyone.

Paying back your discount

If you sell your Right to Buy home within 5 years of buying it, you’ll have to pay back some or all of the discount you got. If you sell within the first year, you’ll have to pay back all of the discount.

On top of this, the amount you pay back depends on the value of your home when you sell it.

So, if you got a 20% discount, you’ll have to pay back 20% of the selling price.

If you sell after the first year, the total amount you pay back reduces. You pay back:

  • 80% of the discount in the second year
  • 60% of the discount in the third year
  • 40% of the discount in the fourth year
  • 20% of the discount in the fifth year

Rural homes

Your landlord may limit who you can sell your home to if your home is in:

  • a national park
  • an area of outstanding natural beauty
  • an area the government says is rural for Right to Buy

For example, you may have to sell your home to someone who’s lived or worked in the area for more than 3 years. This may mean you have difficulty getting a mortgage to buy your home.

For further information, help and advice, click here.

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