On 3rd January 2014 the Department of Communities and Local Government (DCLG) announced proposed modifications to the Right to Buy (RTB) scheme. These are seen as part of the ongoing commitment to keep the RTB scheme under review and ensure that some eligible tenants will be able to realise their home ownership aspirations sooner. The changes, which are highlighted below, will require amendments to legislation. It is hoped this will be done by May 2014, subject to parliamentary process. The changes are:
Right to Buy Update
24th January 2014
1. To increase the maximum RTB percentage discount for eligible social tenants in houses to 70%, bringing them in line with the current maximum discount for flats. The rate of increase year-on-year remains unchanged.
2. The maximum cash cap will be increased in line with the Consumer Price Inflation (CPI) rate of inflation, ensuring that the discount remains effective in real terms. Currently the maximum discount in London is £100,000, with the rest of the country capped at £75,000.
Proposals are also being made as part of the Deregulation Bill to reduce the qualifying period for RTB from five years to three years. The government announced in the autumn statement that:
1. RTB agents will be appointed from April 2014 to help tenants complete their home purchases free of charge.
2. A £100 million fund to improve an applicant’s ability to access mortgage finance will be established and available from the 2015-16 financial year.