Flagship Tory council gives tenants 'right to part buy' their home
Published by Jon Land for 24dash.com in Local Government and also in Housing
Flagship Tory council gives tenants 'right to part buy' their homes
Council tenants in Hammersmith & Fulham (H&F) have become the first in the country to be able to buy their council home one share at a time.
Councillors in the flagship Tory borough have approved a plan that will enable council tenants to buy a share in their home from as little as 15% and pay rent on the remaining share. Then, as and when they can afford it, they will be able to buy further shares until they eventually own it outright.
Called Right to Buy Part, the new scheme, which works like a traditional shared ownership offer, has already received backing in the Mayor of London’s latest housing strategy and been welcomed by the Secretary of State for Communities and Local Government.
The council estimates that households with incomes ranging from just under £19,000 to £37,000 will benefit from the pioneering scheme.
Cllr Andrew Johnson, H&F Council’s cabinet member for housing, said: “We’re bringing the home ownership ladder down a few rungs lower to make it easier for hardworking council tenants to take their first steps on it.
“Right to Buy Part is something we’ve been developing for some time, and we’re confident it will enable more council tenants on modest or low incomes to realise their dream of owning their home by purchasing it, bit by bit, over a period of time that suits them.
“With H&F having the third highest property prices in the UK even an option like Right to Buy is not possible for many tenants – but this scheme will finally bring it within their reach.”
Under the Right to Buy Part scheme, which is available to tenants who’ve had a tenancy for three years or more, those taking part may also be entitled to an element of the Government’s Right to Buy discount on the share they buy. The council plans to set the rent they pay on the remaining share at a level closer to social rents than market rents.
Welcoming the H&F Council’s new scheme, Eric Pickles, Secretary of State for Communities and Local Government, said: “Our decision to raise discounts and extend eligibility under the Right to Buy has made homeownership a realistic option for London’s hard-working social tenants. Almost 3,000 have taken up the improved offer since 2012, and sales in the last three months were ten times what they were for the same quarter in 2010.
“I’m delighted Hammersmith & Fulham will now go even further by offering shared ownership under Right to Buy, enabling more tenants to take their first step on the property ladder.”
H&F Council has calculated, based on current property prices, that a tenant living in a one-bed council home in Shepherds Bush would need a yearly income of £18,627 to buy a 15% share in their home.
Alternatively, a combined yearly income of £36,605 would be required for a local family to buy a 15% share in their three-bed council property in Fulham.
If the owner/shared owner later decides to sell, the property will be offered to local people on the borough’s Home Buy register – a list of nearly 6,000 residents who are desperate to become homeowners in H&F.
The council, which will retain the discretion to buy-back property purchased through Right to Buy Part, will use money generated by the scheme’s sales to invest in new homes or existing estates or to repay historic housing debt, reducing interest repayments in the process.
The council’s dedicated Home Buy team has to-date helped more than 700 low-and-middle-income earners into home ownership, through schemes such as shared ownership and discounted market sales.