The government has today launched the long-awaited Right to Buy pilot for housing association tenants, but you’ll need to get lucky in a ballot if you want to buy your home.
The Midlands Voluntary Right to Buy Pilot is set to give thousands of tenants in the Midlands the opportunity to own their property, but it’s likely to be at least a couple of years before the rest of the country gets a chance.
Here, we explain how the pilot will work and how you can use the scheme to buy your housing association home.
- If you want to use your Right to Buy and would like expert help finding the best mortgage for your situation, call Which? Mortgage Advisers on 0800 197 8461.
£200m funding for Right to Buy pilot scheme
Today’s pilot marks the extension of the Right to Buy scheme to housing association tenants.
Launched in 1980, the scheme previously only allowed council tenants to purchase their homes at a discount.
The government is putting £200m behind the pilot, with places to be allocated via a ballot, and says that money from the discounted sales will be used to fund replacement homes.
David Orr of the National Housing Federation, which has worked closely with the government on the pilot, says the scheme ‘will be a success for everyone involved only if every home that is sold is replaced with a new affordable home’.
- Find out more about how the scheme works in our full guide on Right to Buy.
How will the ballot work?
While £200m sounds like a lot of money, the government believes demand will outstrip supply, so you’ll have to get lucky in a ballot to have a chance of buying your housing association home.
The ballot will run for a month from today until 16 September. After it closes, places will be randomly allocated.
Successful tenants will then have to prove they meet the eligibility criteria and formally apply to secure their spot.
The government says a ballot is the fairest way of managing interest in the scheme, as a ‘first-come, first-serve’ system would disadvantage some residents.
- You can register by filling out the Voluntary Right to Buy Midlands Pilot ballot form.
Are all properties available?
Not necessarily. Housing associations will be able to choose which properties they sell.
However, if a home is exempt from the pilot, the housing association must instead give the tenant the opportunity to use their discount on another property.
This rule, known as the portable discount, is being trialed in the pilot.
- If you’re thinking about buying a home, find out how much your mortgage would cost each month with Which? Mortgage Advisers’ mortgage repayments calculator.
Which housing associations are participating?
Most of the main housing associations in the Midlands region are taking part, as well as some smaller associations.
Use the search function in the table below to find out if your association is taking part:
- The government provides further information on participating associations on its key information page.
Does Right to Buy offer a discount?
The government hasn’t confirmed exactly how the discount system will work for housing association properties.
Under the existing Right to Buy scheme for council homes, the amount of discount you get depends on the type of property you’re buying and how long you’ve been a tenant.
If you live in a house and have been a tenant for at least three years, you can get a 35% Right to Buy discount. After five years, the discount increases by 1% each year, up to a maximum of 70% off the purchase price.
Buyers who live in a flat get a discount of 50% after three years, which increases by 2% each year after five years. As with houses, the maximum discount for people buying their flat is 70% off the purchase price.
The government will fully fund these discounts, and housing associations will use the money from sales to fund replacement homes.
Will the scheme be extended beyond the Midlands?
Not for a while. The pilot will run until Spring 2020, and after that the government will assess its impact before deciding on its next steps.
How to get mortgage advice
In most cases, people using Right to Buy will take out a normal mortgage to buy their property.
If you want expert help finding the right mortgage for you, you can get a free call back from a Which? mortgage adviser by filling out the form below.
Your home may be repossessed if you do not keep up repayments on your mortgage.
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