The Right to Buy for secure council tenants

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Right to buy

Right to Buy legislation:

On 26 May 2015 the Qualifying Period reduced from 5 years to 3 years. 

On 06 April the Maximum Discount Cap increased from £77,000 to £77,900

Further information about the Right to Buy

Date of last review: 21 October 2016

This information is for tenants of St Albans City and District Council.

The Right to Buy scheme allows eligible secure tenants in Council Housing to buy their home at a discount. This is based on the valuation of the property and the length of your qualifying tenancy. 

Houses are normally sold on a freehold basis. 

Flats and maisonettes are normally sold on a leasehold basis.

Questions and Answers

1. Do you have the Right to Buy your home?

To qualify for a discount through the Right to Buy you must have been a tenant of a council, housing association or public sector landlord for 3 years. These years do not have to be continuous and could have been in different homes with different public sector landlords. 

Not all secure tenants have the Right to Buy. In the St Albans City and District those who do not have the Right to Buy may include:  

  • tenants living in homes suitable for occupation by the elderly -  taking into account location, size, design, heating system and some other features 

  • tenants living in homes which were let to them or the previous tenant for occupation by a person aged 60 or over and which were first let before 1st January 1990  

  • tenants living in homes which are due to be demolished  

  • tenants living in Retirement housing (also called sheltered housing) 

  • tenants living in homes which the Council has leased from a third party and which the council does not own  

  • tenants living in almshouses  

  • tenants living in temporary accommodation for the homeless  

  • Introductory Tenants 

In addition, you will not be allowed to buy your home if the Council has a court order for possession of your home or if you are an undischarged bankrupt, have a bankruptcy petition pending or have made an arrangement with creditors and still have money outstanding.

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2. How is your home valued?

We will send you an RTB2 notice to let you know if you have been given the Right to Buy. Once you have been given the Right to Buy we will send your details to a local Valuer who acts on the Council's behalf. The Valuer will contact you to arrange an appointment to visit and assess the value of your home.
The Valuer will not take into account your own improvements on the property which you should list on your application. After the Council has received information from the Valuer we will prepare and send you your Offer Notice (Section 125 Notice).  

If you do not agree with the valuation, you have the right to request a redetermination to be carried out by the District Valuer.  The District Valuer is  independent of the Council and does not work on our behalf. Details of how to do this can be found on your Offer Notice.

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3. Will you be entitled to a discount?

The maximum discount is capped at £77,900 for applications received on or after 06 April 2015.

Your actual discount will depend upon:

  • the valuation of the property (see question 2) 

  • the time you have been a tenant of either a council, housing association or other public sector landlord (see below)

  • the cost of any repairs or refurbishment carried out by the Council  in the last 15 years - the Cost Floor figure(see below)

  • if you have previously purchased under the Right to Buy

Since 26 May 2015-
The maximum discount is capped at 70% or £77,900 - depending upon which limit is reached first for both houses and flats.
Houses:-  

  • after being a tenant for 3, 4 or 5 years, you will get a 35% discount of its market value. 

  • After 6 years of tenancy– you will get an additional 1% discount for each complete year you have been a tenant. 


if you are buying a flat:-

  • after being a tenant for 3, 4 or 5 years, you will get a 50% discount of its market value.

  • after 6 years of tenancy - you will get an additional 2% discount for each complete year you have been a tenant. 

Cost Floor:- 

If the expenditure comes to more than the value of your home you may not get a discount at all

Note for applicants who have previously purchased under the Right to Buy and received a discount.
The discount you are entitled to will be reduced by the amount of the discount you received the previous time you purchased a property under the Right to Buy.

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4. Right to Buy legislation changed on 26 May 2015

The  Maximum Discount Cap figure is now £77,900 (in line with the Consumer Price Index (CPI).
After 26th May 2015  the Qualifying Period was reduced from 5 years to 3 years. 

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5. What discount will I receive if my application form was received by the Council before 26 May 2015?

If your application was received by the Council before 26 May 2015:- 

if you are  buying a house you will get a 35% discount after being a tenant for 5 years. You will then get an additional 1% discount for each complete year you have been a tenant. The maximum discount is 70% or £77,900. (unless your applications was received before the 06 April. Then this will be £77000)

If you are buying a flat you will get a 50% discount after being a tenant for 5 years and then an additional 2% for each complete year up to a maximum of 70% or £77,900, (unless your application was received before to 06 April then this will be £77000).

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6. Will you have to repay the discount?

There are some circumstances under which you may have to repay the discount
If you sell your home within 5 years of buying it you will have to pay back all, some or potentially more of the discount you received, based on a percentage of the resale value of the property.

  • In the first year you will have to repay all the discount 

  • In the second year you will have to repay 80% of the discount 

  • In the third year you will have to repay 60% of the discount 

  • In the fourth year you will have to repay 40% of the discount 

  • In the fifth year you will have to repay 20% of the discount

How much you pay back depends upon the value of your home when you sell it.

For example, if your home was valued at £100,000 when you bought it and you received a discount of 40% (£40,000) when you bought it. If then you sold your home in the first year for £110,000 you would have to repay 40% of £110,000 (£44,000).
If you can’t afford to repay the discount e.g. because the bank or building society is selling your home you should inform the council immediately.

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7. Selling the property on the open market

If you decide to sell your property and you purchased your home under the Right to Buy scheme after 18th January 2005, you must give the Council (or another social landlord in the area as nominated by the Council) the right of first refusal. 

If the Council does decide to purchase, the property will be bought at full market value which will be agreed by you and the Council. (This does not take into account any discount that needs repaying.)

If you and the Council are unable to reach an agreement on the value of your property, the independent District Valuer will decide. 

If your offer has not been accepted by the Council (or its nominated agent) within 8 weeks from your formal request, then you are free to sell the property on the open market.

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9. How much is it likely to cost to buy your home?

In addition to the actual purchase price of your home there are other costs associated with buying a property. These could include:-

  • Survey - to identify any current or future maintenance and structural problems with the property 

  • Legal fees - you may need to hire a solicitor or other licensed conveyancer for the legal aspects of your purchase.

  • Stamp Duty may be payable - your solicitor should be able to advise you of how much this will be 

Survey and Legal fees and services vary from supplier to supplier. You may wish to check a number of suppliers before making a decision.

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9. How do I apply?

To apply for the Right to Buy you need to fill in a Right to Buy Claim form (RTB1) and send to your landlord.

To receive the form and guides you can:

Complete the form carefully as the information you give will be used to decide if you have the Right to Buy and how much discount you will receive. 

Within 4 weeks the council will send you a Notice informing you whether you have the Right to Buy. If you don't have the Right to Buy the reasons will be given.
If you do have the Right to Buy you will then receive an Offer Notice (Section 125 Notice). If you are buying a house we will send the Offer notice within 8 weeks of sending out your acceptance Notice and within 12 weeks if you are buying a flat or maisonette. 

The Offer Notice describes 

  • the property, 

  • the purchase value,

  • your discount and how it was worked out, 

  • details of any known structural defects, 

  • estimates of any service charges and any other charges and 

  • the terms and conditions of the sale. 

You will need to make a decision within 12 weeks from the date on the Offer Notice to:

  • accept the offer, 

  • request re-determination of the value of the property, or 

  • withdraw from the process 

Once you have accepted the offer you have 6 months to purchase the property from the date on your Offer Notice.

Details of the process can be read in "Your Right to Buy a Home" guide.
If the Council delays the process or does not return the documents within the statutory timescales, you may be entitled to a reduction in the purchase price. Further information on the delay procedure is available in Your Right to Buy Your Home guide. RTB6 and RTB8 forms can also be downloaded.

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10. More help and assistance?

Please call St Albans City and District Council direct on 01727 819506 or if you prefer to be guided throughout the Right to Buy process there are also Right to Buy Agents able to assist you; you can call then direct on 0300 123 0913 Monday to Friday 8am to 6pm.

The Department for Communities and Local Government website link:-  
http://righttobuy.communities.gov.uk/   

Links to Right to the Right to Buy Agents – to provide Tenants with help assistance and guidance throughout the RTB process -http://righttobuy.communities.gov.uk/agent-service/

Links to legislation changes from 2014
http://www.legislation.gov.uk/2014-2016?title=Right%20to%20Buy

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Date of last review: 21 October 2016