Purchase law explained – what Boris Johnson’s plan means for housing cooperative tenants

In an announcement this afternoon, Prime Minister Boris Johnson confirmed plans to extend the right to buy so most housing association tenants will now be eligible

The purchase right is extended to housing cooperative tenants
The purchase right is extended to housing cooperative tenants

Right to Buy is a government program in England that allows most council tenants to buy their home at a discounted price.

People living in council properties can get a discount of up to 70% of the market value of their home, up to a maximum of £87,000.

For homes in London, the maximum discount is £116,200.

Most housing association tenants cannot use the right to purchase to buy their house as it is – although there are some exceptions mentioned below.

But in an announcement this afternoon, Prime Minister Boris Johnson confirmed plans to extend the right to buy so most housing association tenants will now be eligible.

In England there are around 2.5 million households or five million people who rent from housing associations.

The Prime Minister said: “It will work for renters and give millions more the chance to own their own home.

“It will work for taxpayers, responsibly capped at levels that will be paid in full, affordable within our existing spending plans, and replace every public housing policy sold on a one-for-one basis.”

Here we explain how Right to Buy works at the moment…

What is purchase right?

Under the existing program, you may be able to purchase your home at a discounted rate through the Right to Buy program if you live in a council property or former council house.

You can apply to purchase your meetinghouse if:

  • It is your sole or primary residence

  • It is self contained

  • You are a safe tenant

  • You have had a public landlord (e.g. a council, housing association or NHS trust) for three years. It doesn’t have to be three years in a row.

The maximum discount is £87,200 across England except in London where it is £116,200. This increases every April in line with the consumer price index (CPI) inflation rate.

The discount is based on:

Receive a 35% discount if you’re an industry renter between three and five years and buy a home.

After five years, the discount increases by 1% for each additional year, up to the maximums above.

When buying an apartment, you will receive a 50% discount if you have been a public tenant for between three and five years.

After that, the discount increases by 2% for each additional year, again up to the maximum values.

You can use Right to Buy with someone who shares your lease, or with up to three family members who have lived with you in the past 12 months, even if they’re not on the lease.

If you’re buying with someone else, count the years of whoever has rented the longest in the public sector when calculating your discount.

You may get a smaller discount if your landlord spent money building or maintaining your home, or if you’ve used the right to buy in the past.

If you’re sold out, you usually have to pay back some or all of the rebate if you used the right to buy five years earlier.

The Prime Minister has not indicated when the changes to the purchase law for housing association tenants would come into force or whether the same criteria as above would apply.

What help is already available for housing cooperative tenants?

Some safe council tenants may have a “got” right to buy, which works in the same way as the traditional system.

To qualify for a “received” right to buy, you must reside in a home that has been sold by your municipality to another landlord, such as a home owner. B. a housing association.

You must have lived in the property at the time the apartment was handed over.

It can also apply if you then move to another apartment owned by the new landlord – but not to another landlord.

If you do not qualify for “received” right to purchase, there is another scheme called “right to purchase”.

This program offers discounts of between £9,000 and £16,000, which is significantly less than Right to Buy.

The Government previously launched a £200m pilot of a voluntary buying rights scheme in the Midlands in August 2018, which included housing association tenants.

Since then, no new pilot projects have been started.

https://www.mirror.co.uk/money/right-buy-explained-what-boris-27190180 Purchase law explained - what Boris Johnson's plan means for housing cooperative tenants

Fry Electronics Team

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