Buy your home
Buying your home is probably the biggest financial decision you will ever make, so you need to take time to consider whether it is the right choice for you and the costs involved in becoming a homeowner.
Can I buy my home?
You can only claim the Right to Buy if the property is your ‘only or main home’.
The agreement of any tenant who does not wish to buy must be obtained before you claim the Right to Buy.
You may share the Right to Buy with up to three family members over the age of 18. They must be a spouse, civil partner or wider family member, but do not have to be tenants themselves. Wider family members must have also lived in the property as their main home for at least the last 12 months.
There are two ways you can purchase your home.
The Right to Buy
To qualify for the Right to Buy you must be living in a Merlin home and have been a council or housing association tenant for at least three years. If you were living in your home in 2007 when it was transferred from South Gloucestershire Council to us, then you may have a Preserved Right to Buy.
You can not buy your home if:
• a court makes a possession order
• you are an undischarged bankrupt or have other legal problems with debt
• your Right to Buy is suspended under a Court Order due to anti-social behaviour.
Some homes are not available to buy under the scheme. These include sheltered housing and homes due to be demolished.
If you are eligible for the scheme then you will be entitled to buy your home with a discount. This discount is applied a percentage of the open market value of your home and will vary depending upon how long you have been a public sector tenant. Tenancies with other landlords may count towards your entitlement.
The percentage of discount for a house starts at 35% for three to five years of public sector tenancy and increases by 1% per year of tenancy to a maximum limit of 70%. The percentage of discount for a flat starts at 50% after three to five years and increases by 2% per year after to a maximum limit of 70%.
However the maximum discount permitted under Government guidelines is £77,900.
The Right to Acquire
You may have the Right to Acquire your home if it was built with public funds, or if it was transferred from a local council to a housing association after April 1997.
If you hold an eligible secure or Assured tenancy type you may qualify for this. To qualify you must have either been a tenant since 18 January 2005 or if your tenancy started after this date, you must have been a tenant for five years.
Only some properties can be bought under the right to acquire. Your home must have been:
• Built or bought by us after 1 April 1997; and
• Was paid for through a social housing grant
Some types of property do not qualify for the right to acquire. These include:
- Supported housing properties
- Homes designed or adapted for people with special needs
- Homes due to be demolished
- Homes in rural areas
The discount for the Right to Acquire in the South West is £11,000.
How to apply to buy your home
Download the application form, fill it out and send it back to us.
What happens next?
Once you have applied to purchase your home we’ll carry out a tenancy and eligibility check. Once we’re satisfied that you can buy your home, we’ll formally admit your RTB/RTA application and then get a market valuation of the property.
This will take into account the condition of the property and any improvements we’ve made. We will not take into account any improvements you have made to the property when calculating its value.
After we have valued the property we will send you an offer notice with the purchase price. If you think the price is too high, you can ask us to get an independent valuation from the District Valuer. If this happens, we’ll use this valuation even if it is higher than the original.
After you have been sent the purchase price you have 12 weeks to decide whether you want to proceed with purchase. If you do decide to proceed we will ask a surveyor to measure the property, and prepare the necessary sale plans. Once this has been done, the plans and related documents will be sent to our solicitor for the completion of the sale.
If you don’t have the money available to buy your home, you will have to get a mortgage from a bank or building society. Many mortgage schemes have a minimum income level which you will have to meet to be eligible. Most will not accept people on means-tested benefits.
You can change your mind at any stage and cancel your application. You are free to reapply at a later date.
What other costs should you consider?
Stamp Duty Land Tax
This is a tax you have to pay if you buy a property worth more than £125,000. The size of the tax depends on the value of the property. It is charged at increasing rates for each portion of the price of the property.
- nothing on the first £125,000 of the property price
- 2% on the next £125,000
- 5% on the next £675,000
Correct from 4 December 2014
If you buy a property for £275,000, you’ll pay £3,750 of Stamp Duty. This is made up of:
• nothing on the first £125,000
• £2,500 on the next £125,000
• £1,250 on the remaining £25,000
You should use a solicitor or licensed conveyancer to look after the legal side of buying your home. Their fees vary, so always ask how much their advice will cost before you appoint anyone.
You should have the property surveyed. Survey fees vary, but you should allow between £250 and £600 depending on the level of detail required.
Valuation fees and mortgage application costs
If you get a mortgage, you may have to pay the cost of arranging it. You may also be charged a valuation fee by the mortgage lender.
There are also a number of regular payments you will need to pay as a homeowner that you don’t currently pay. These include:
• Mortgage payments - remember that interest rates can increase which may mean higher payments each month.
• Life insurance to cover the risk of death of one of the people paying the mortgage.
• Buildings insurance. This will be a requirement if you are taking out a mortgage on a house.
Buying the lease to your flat
If your home is in a block of flats you will be buying a lease to the property and will become a leaseholder. In this situation we will remain the freeholder and you will be granted a lease for a set number of years typically 125 years.
Although you will no longer be liable for rent you will need to continue to pay for things such as ground rent, buildings insurance and service charges. As a leaseholder you will be responsible for payment of service charges for items such as the cost of regular day-to-day maintenance of the block and also a contribution towards major works, like repairing the roof or replacing a lift, which can be expensive. The service charges that you’ll be charged for will be detailed within your lease.
If you apply to buy your flat, we must give you an estimate of the service charges you’ll be expected to pay during the first five years after you buy. We cannot charge you more than that figure during the first five years of the lease, except to take account of inflation.
Selling your home after you have bought it
You can sell your home whenever you like. However, if you sell it within five years of buying it you will have to repay some or the entire discount you received.
The amount you will have to repay is as follows:
In the first year: 100% of the discount will have to be repaid
In the second year: 80% must be repaid
In the third year: 60% must be repaid
In the fourth year: 40% must be repaid
In the fifth year: 20% must be repaid
After five years you can sell without repaying any discount. If you pay service charges to us you should inform us that you are selling your property to ensure that any outstanding charges are apportioned correctly between the buyer and seller.
If you decide to sell your home within ten years of buying it, then you have to offer to sell it back to us. If we wish to buy it back then we would have to pay you the full market value, minus any discount due to be repaid if the property is sold within five years of the original RTB purchase.