Entitlement to the Right to Buy
by Helen Lisney, Legal Officer
The Right to Buy is governed by Part V of the Housing Act 1985 (the Act).
Section 118 of the Act states that a secure tenant has the right to buy, subject to the certain conditions and exceptions.
What is a secure tenant?
Section 79 of the Act provides that a tenancy under which a dwelling house is let as a separate dwelling is a secure tenancy at any time when the conditions described in sections 80 and 81 as the landlord condition and the tenant condition are satisfied, subject to the certain exceptions.
Section 80 – The landlord condition is that the interests belongs to a local authority.
Section 81 – the tenant condition is that the tenant is an individual and occupies the dwelling-house as his only or principal home, or where the tenancy is a joint tenancy, each tenant is an individual and at least one of them occupies the dwelling-house as his only or principal home.
The exceptions referred to in section 79 are set out in schedule 1 to the Housing Act as follows:-
Tenancies which are not secure tenancies.
Para 1A: Introductory tenancies
Para 2: Premises occupied in connection with employment;
Para 3: If the dwelling house is on land acquired by the Council for development purposes and being used as temporary housing accommodation pending development.
Para 4: Accommodation for homeless persons
Para 4ZA: Family Intervention tenancies
Para 4A: Accommodation for asylum-seekers
Para 7: Where temporary accommodation is made available while works are carried out on the house they previously occupied.
Para 8: Where the dwelling is part of an agricultural holding
Para 9: Where the dwelling includes premises licensed to sell alcohol.
Para 10: Student accommodation
Para 11: Where the premises are let for business purposes.
Para 12: Almshouses.
Any other tenancy where the Landlord is a local authority will be a secure tenancy.
There is no mechanism to exclude properties that are owned by the Council from the right to buy, other than as set out below.
Qualifying Period for the Right to Buy – Section 119
To qualify for the right to buy a tenant must be a secure tenant, and have been a public sector tenant for a period, or periods totalling three years.
A period qualifies if it falls within the following criteria which are included is Schedule 4 of the Housing Act 1985.
Para 2: The secure tenant, or his spouse or civil partner (if they are living together, or in the case of deceased spouse were living together at the time of death) was a public sector tenant
Para 4: The secure tenant since reaching the age of 16 occupied as his only or principle home a dwelling where his parent was the public sector tenant and he became a public sector tenant less than two years after the end of that period.
Para 5: The secure tenant, or his spouse or civil partner occupied accommodation provided to them as a member of the armed forces.
Circumstances in which the right to buy cannot be exercised – Section 121
Even if a tenant meets the criteria set out above, they will not be able to exercise the right to buy in the following circumstances..
- If the tenant is subject to a court order for possession of the property;
- If the tenant has made a bankruptcy order that has not been determined, has a bankruptcy petition pending against him, is an undischarged bankrupt, has a composition arrangement with his creditors the terms of which remain to be fulfilled or is a person to whom a debt relief order applies.
- If the tenancy is subject to a suspension period under an order made under section 121A in respect of the secure tenancy.
Exceptions to the Right to Buy – Section 120
There are certain properties that are excepted from the right buy and these are set out in Schedule 5 of the Housing Act 1985. The following can relate to Local housing authority tenancies:-
Para 4: Where the landlord does not own the freehold of the property and does not have a sufficient interest to grant a lease.
Para 5: Where the dwelling:
– Is within the curtilage of a building which is held mainly for purposes other than housing and consists mainly of accommodation other than housing accommodation or is situated within a cemetery; and
– was let to the tenant in relation to their employment.
Para 7: Properties for occupation by physically disabled persons that are:-
– one of a group of dwellings which it is the practice of the landlord to let for occupation by physically disabled persons, and
– a social service or special facilities are provided in close proximity to the group of dwelling houses for the purpose of assisting those persons.
Para 9: Properties that are:-
– one of a group of dwellings which it is the practice of the landlord to let for occupation by persons who are suffering or have suffered from a mental disorder, and
– a social service or special facilities are provided in close proximity to the group of dwelling houses for the purpose of assisting those persons.
Para 10: Properties that are:-
– One of a group of dwellings which are particularly suitable, having regard to their location, size, design, heating systems and other fieatures, for occupation by elderly persons; and
– which is the practice of the landlord to let for occupation by persons aged 60 or more; and
– either has the services of a resident warden, or the services of a non-resident warden, a system for calling him and the use of a common room in close proximity to the group of dwelling-houses.
Para 11: Where the dwelling house:-
– is particularly suitable, having regard to its location, size, design, heating system and other features for occupation by elderly persons; and
– was let for the occupation of a person who was aged 60 or more.
In making a decision to deny the right to buy under paragraph 11 above the decision maker will normally be expected to be satisfied on the following points:-
- there should be easy access on foot. Access is unlikely to be regarded as easy if it is necessary to climb three or more steps (in addition to the threshold) and there is no handrail;
- the accommodation should normally be on one level;
- in the case of a flat above ground floor there should be easy access by lift;
- there should be no more than two bedrooms;
- there should be heating arrangements which function reliably and provide heat to at least the living room and one bedroom, and
- the accommodation should be located reasonably conveniently for shops and public transport having regard to the nature of the area.
If the dwelling falls within one of the exceptions above, the landlord shall serve a notice under section 124 of the Act denying the right to buy and stating the reasons, why, in the opinion of the landlord the tenant does not have the right to buy.
Where the right to buy is refused on the basis of paragraph 11 above then the tenant may make an application to the First Tier Tribunal within 56 days of the service of the section 124 notice. The question shall then be determined by the Tribunal. If so application is made within 56 days the question shall be deemed to have been determined by the Tribunal.
If the right to buy is refused on any of the other grounds, then the tenant’s challenge would be made by an application to the county court.
Discount entitlement
Under the right to buy provisions the purchase is entitled to an initial discount of 35 % of the market value for years 3-5 of their entitlement. After year 5 this increases by 1 % for each year of tenancy up to a possible discount of 70%
There is a cap on the amount of discount which is changed each year but is currently set at £96,000.
