Right to Buy Mortgages
Right to Buy Mortgages: ‘Right to Buy’ is a government backed home purchase scheme in England for council house tenants to purchase the home they currently rent. The Right to Buy discount is generous and can allow council (and some housing association) tenants to purchase their rental property at a discounted price. Since 1980, thousands of families have used the scheme to purchase their home.
Discounts since 2014:
The maximum discount on any property is capped at £96,000 across England, and £127,900 for properties in London. The amount of discount increases every year in line with the consumer price index (CPI).
HOUSES: You can get a 35% discount for tenants renting for 3 – 5 years. After 5 years, the discount increases by 1% for every additional year up to a maximum of 70% or the above mentioned discount cap.
FLATS: You get a 50% discount for tenants renting for 3 – 5 years. After 5 years, the discount increases by 2% for every additional year up to a maximum of 70% or the above mentioned discount cap.
The maximum discount from April 2024 is £136,400 in London, and £102,400 outside of London.
The above discounts ceased on 21st November 2024. Labour has reduced the amount of discount available. There is a chance these generous discounts may return in the future under a new government, but we should assume they will not change again till around 2019.
If you have have applied for Right to Buy before 21st November 2024, then contact us immediately to so we can arrange your right to buy mortgage. The S125 form which confirms your discount can expire after a certain amount of time. If it expires you will need to reapply under the new lower discounts. So act quickly to arrange your mortgage whilst securing the older more generous discounts.
Discounts from 21st November 2024:
The new maximum discount you can get is the lower of:
- 70% of the value of the property
- The maximum discount Cap for your area
Check below to see what region your home is located and the maximum discount Cap for your region. There are also some exceptions that increase or decrease the discount.
| REGION | MAX. DISCOUNT | EXCEPTIONS |
| North East | £22,000 | n/a |
| North West | £26,000 | n/a |
| Yorkshire & Humber | £24,000 | n/a |
| East Midlands | £24,000 | n/a |
| West Midlands | £26,000 | n/a |
| Eastern | £34,000 | £16,000 in the district of Watford |
| South East | £38,000 | £16,000 in the areas of Reading Borough and West Berkshire, Hart District, Oxford and Vale of the White Horse District, the boroughs of Tonbridge and Malling, Epsom and Ewell, and Reigate and Banstead |
| South West | £30,000 | n/a |
| London | £16,000 | £38,000 in the boroughs of Barking and Dagenham and Havering |
Also worth noting that your discount can be reduced if your Landlord has incurred expenses in maintenance and upkeep of your property. This often impacts flats more than houses, due to communal areas, hall ways and lifts and fire systems that need to be maintained.
What do these changes mean?
In summary it will be harder to purchase your home using Right to Buy, but not impossible!
Because the discount is reduced, many people will need bigger mortgages, which may not be affordable. They may also need to put down a larger cash deposit to buy their home, and they may not have the savings to do so.
However, the discount is still reasonable and effectively ‘free money’ off the cost of your home. The discount can be used as your deposit, so it reduces the amount you need to put in. Speak to our team of expert mortgage advisers who can advise on the best method to buy your council/housing association home.
Contact us
About us
First Select Mortgage Brokers are friendly and professional mortgage brokers. We can access mortgages from the whole of the UK mortgage market, meaning we can get the best possible deal for our clients circumstances. Based in Manchester, we are a family business with decades of experience in financial services. Our goal is to be the most trusted regional mortgage advisory business in the northwest of England.
Our team of experts are ready and waiting to help. Contact the team below:
Phone: 0161 393 1575 or 07780 446 937
Email: hello@firstselectfs.co.uk
Visit our Contact Us page to make a formal enquiry
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References & Disclosure:
https://www.gov.uk/right-to-buy-buying-your-council-home/discounts
https://www.ownyourhome.gov.uk/scheme/right-to-buy/applying/rtb1-application-form/