What's all the noise about Right to Buy?

What's all the noise about Right to Buy?

There has been a lot of negative press about the government's proposed extension to the Right to Buy scheme, with detractors stating that it's already reducing council housing and encouraging housing fraud in certain areas.

The intention of Right to Buy was to allow council tenants to purchase their home at a discount. It applies to most council tenants, as long as it’s their only or main home, is self-contained and they are a secure tenant that’s had a public sector landlord for three years.

However, a proposed change to the legislation, which is part of the Housing and Planning Bill, would also give housing association tenants the opportunity to buy their own home at discounts previously only open to council tenants. This could mean a discount of up to £103,900 in London and £77,900 in the rest of the country.

As compensation to housing associations for having to sell their properties at prices below market value, the Government has promised that a replacement home will be built for every housing association home sold under the scheme. Detractors say that this will put more pressure on councils for housing, and that the properties to be built aren’t necessarily going to be like-for-like.

Ultimately though, the aim of this is to get more people onto the property ladder, and for the wider market, that can only be a good thing. The number of first-time buyers is expected to rise significantly this year, partly thanks to schemes like this, and that’s creating a lot of movement in the market, from the bottom up.

At Together we provide funding for Right to Buy mortgages, based on both capital repayment and interest-only, with many income sources accepted; including employed, self-employed, DWP benefits and pensions. Loan amounts range from £3k to £200k, with loan-to-values of up to 60%, and we’ve seen marked growth in funding for Right to Buy properties in the last quarter.

Following on from my last blog on property hotspots, it’s no surprise to learn that London tops our table for Right to Buy loans in the last 12 months, accounting for 20% of all funding. That’s followed by the thriving Yorkshire and Humber region, and the North West.

The Humber region is enjoying an exciting period of growth, with Hull preparing to be crowned the City of Culture in 2017 and a significant increase in the number of businesses in the region, with the Chancellor proclaiming last year that Yorkshire had created more jobs than France. House prices went up by 3.3% and this growth looks set to continue, so it’s perhaps unsurprising to see the Right to Buy scheme proving successful in this area.

For property professionals and investors, incentives to help drive more people into the market will stimulate wider demand for properties, whilst for previous council or housing association tenants, this is the opportunity of a lifetime to become a home-owner.

So I’ll ignore the naysayers for now, as I believe schemes like Right to Buy can be a positive force for the market and I’ll be eagerly watching to see how this develops under the proposed changes.

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daniel black
daniel black 25 Oct 2016

I've been keeping a close eye on what the effect of Brexit has been on the rental market and it's a very mixed bag. Whilst the majority of the news focuses on London's market. I think this time next year...

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Northerner 20 Oct 2016

Any views from outside the M25? No wonder politicians can't get the housing big picture when everyone seems to think that London is the yard stick, when it absolutely is not.

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Sean Lees
Sean Lees 13 Oct 2016

I think that the pest control really depends on the situation. If the tenant moved in and found an infestation that needs pest treatment service, I think it's more reasonable that the landlord should pay...

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Kevin 13 Oct 2016

Please Sian Berry Dan Wilson Craw LANDLORDS DO NOT WANT TO RAISE RENTS They are being forced to because of Section 24! An unfair, punitive tax hike that will be a disaster Green Party, Generstion...

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Fletcher88 11 Oct 2016

Absolutely agree! Moreover property prices edged up with 0.7% this month as the market recovered from the initial Brexit hit

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Gary Das
Gary Das 06 Oct 2016

A lot of lenders (especially the high-street banks and lenders people approach first) could do more to accommodate for the self-employed. It can really be a struggle, as I found out myself last year when...

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richardrawlings 04 Oct 2016

Not sure I understand this! If Basildon and Hemel rose 68% and 52% respectively, why do they not appear in the top ten list, which appears only to feature those in the minus 20's!! Is it me?

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luxus 27 Sep 2016

It can be stressful. More clarity is needed on the process, from a customer perspective and consideration should be given to using the Scandinavian model where the sales process is much quicker.

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Melissa_Green 26 Sep 2016

Green belts are normally designated around capitals and other major cities and conurbations and their aim is to prevent urban sprawl by keeping land permanently open. The essential characteristics of green...

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Jimmy_McCoy 16 Sep 2016

I think that the main reason to buy garden purchases in last minute is because people always search for the best deal. In summer months there are abundance of seasonal goods and it means more low cost

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Jimmy_McCoy 16 Sep 2016

Buying a home often is more expensive than you expect. There are lots of hidden costs such as: stamp duty, surveys and valuations, mortgages etc. that can add more than 10% to the total bill

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Homebuyerconveyancing 15 Sep 2016

We are seeing a massive influx of Homebuyers using online Estate Agents. The winners are the online portals that still aim to manage the customer journey to homeownership. They provide a valuation service,...

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