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Voluntary Right to Buy (VRTB) Regional Midlands Pilot

The Government has decided to launch a pilot of the Voluntary Right to Buy in the Midlands.

You may have heard about the initial pilot involving five housing associations that took place in 2016.  The new pilot in the Midlands will test out other aspects of the scheme.  This means that some assured tenants of housing associations living in general needs properties (this applies to general family housing and dwellings for singles and couples and which is not part of an Independent Living Scheme or an Extra Care Housing complex) in the Midlands may be able to buy their home from their housing provider.  The pilot will be operated on a voluntary basis by housing associations and underpinned by a national agreement between the National Housing Federation and Government.

We will be taking part in this new pilot which is likely to begin in Summer 2018 (date to be confirmed).  There is no confirmation yet of when the VRTB will be rolled out on a national basis. Keep checking the Government’s Right to Buy website for updates.

It is important to note that the Government has allocated a limited amount of money to fund this pilot and will decide when to stop the pilot depending on how much money is left.  It is therefore vital that you keep up to date with the latest developments by looking on the Government’s Right to Buy website.

Whilst we will be able to decide certain aspects of our policy and procedure, a number of the rules for the pilot will be set by the Government – including the decision on who is eligible to purchase their home and from what areas.

This page will be updated regularly to provide further details about the pilot.

Please find below some answers to initial questions that you may have about the pilot.  We will continue to add to this with further information.

From 1st October 2018, Fortis Living and Waterloo Housing Group will join together in a new partnership.   The documents and approach described below reflect our agreed joint approach to Voluntary Right to Buy.

1. Will my area be included in the new pilot?

The Government has decided that only the following local authority areas will be included in the Midlands pilot (your local authority area is the council you pay your council tax to).  Tenants in homes outside these areas are not able to apply to participate:
Eligible local authority areas (A-Z)

Amber Valley Borough Council

Newcastle-under-Lyme Borough Council

Ashfield District Council

North East Derbyshire District Council

Bassetlaw District Council

North Kesteven District Council

Birmingham City Council

North Warwickshire Borough Council

Blaby District Council

North West Leicestershire District Council

Bolsover District Council

Northampton Borough Council

Boston Borough Council

Nottingham City Council

Bromsgrove District Council

Nuneaton and Bedworth Borough Council

Broxtowe Borough Council

Oadby and Wigston Borough Council

Cannock Chase District Council

Redditch Borough Council

Charnwood Borough Council

Rugby Borough Council

Chesterfield Borough Council

Rushcliffe Borough Council

Corby Borough Council

Rutland County Council

Coventry City Council

Sandwell Council

Daventry District Council

Shropshire Council

Derby City Council

Solihull Metropolitan Borough Council

Derbyshire Dales District Council

South Derbyshire District Council

Dudley Metropolitan Borough Council

South Holland District Council

East Lindsey District Council

South Kesteven District Council

East Northamptonshire Council

South Northamptonshire Council

East Staffordshire Borough Council

South Staffordshire Council

Erewash Borough Council

Stafford Borough Council

Gedling Borough Council

Staffordshire Moorlands District Council

Harborough District Council

Stoke-on-Trent City Council

Herefordshire Council

Stratford-on-Avon District Council

High Peak Borough Council

Tamworth Borough Council

Hinckley and Bosworth Borough Council

Telford and Wrekin Council

Kettering Borough Council

Walsall Council

Leicester City Council

Warwick District Council

Lichfield District Council

Wellingborough, Borough Council of

Lincoln – City of Lincoln Council

West Lindsey District Council

Malvern Hills District Council

Wolverhampton – City of Wolverhampton Council

Mansfield District Council

Worcester City Council

Melton Borough Council

Wychavon District Council

Newark and Sherwood District Councli

Wyre Forest District Council

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2. Will I be eligible for the new pilot?

Some tenants will not be able to apply for the VRTB Midlands Pilot. The Government will publish further guidance about the rules around eligibility.  Keep checking the Government’s Right to Buy website for further updates.  Our Voluntary Right to Buy Sales Policy (below) sets out further details on who is eligible to take part.

PDFVoluntary Right to Buy Sales Policy.pdf, 343 kDownload

Some basic checks will include:

  • Do you live in an area included in the Midlands pilot?

Only properties in one of the areas listed above will be included.

  • Do you live in a general needs property?

The VRTB Midlands pilot is only open to tenants living in a general needs property.  This applies to general family housing and dwellings for singles and couples and which is not part of an Independent Living Scheme or an Extra Care Housing complex.

  • Do you already have the Right to Buy or Preserved Right to Buy?

You will not be eligible for the Midlands VRTB pilot if you already have the Preserved Right to Buy or Statutory Right to Buy.  This is likely to be the case if you were a secure council tenant and you were living in your home when it was transferred from the Council to us.  It could also be applicable if you then moved to another home owned by us.  If you are not sure whether you have the Preserved Right to Buy please Contact Us.

  • Have you held a social or affordable housing tenancy for at least three years?

This does not need to have been with the same landlord, or a single continuous tenancy.

  • Is the property your main home?

You must prove that the property is your main home and that you have lived in it for at least the last 12 months. If you are eligible, you can make an application for the VRTB Regional Pilot.  This can be made as an individual or jointly with up to three family members who have lived with you for the past 12 months.  Applicants that apply to purchase the home with you don’t need to be on your tenancy agreement, but it must be their main home.  You will need to provide proof that that they have lived in the property for at least 12 months and that they do not own an interest in any other property.

Please remember that there are a number of other checks that we will need to carry out to check whether you meet the Government’s requirements for this Midlands pilot.  We will confirm if you are eligible once you apply.

Whilst you may be eligible to purchase your property, there will be certain properties that we will not be able to sell.  Where this is the case, we will let you know why, and where appropriate, will look to work with you to “port your discount” (see question 4).  This means that you may be able to purchase another suitable property in your area instead.  Our Portable Discount Policy (below) sets out further details about how this works.

PDFAppendix A - VRTB Portable Discount Policy.pdf, 196 kDownload

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3. How do I know if my property can be purchased under the VRTB pilot?

The Government has decided that the VRTB Midlands pilot will only apply to general needs properties, this applies to general family housing and dwellings for singles and couples and which is not part of an Independent Living Scheme or an Extra Care Housing complex.  Under the voluntary agreement, the presumption is that housing associations will offer to sell eligible tenants the property they are living in.  However, there may be occasions where a housing association is unable to sell tenants their current homes.

It is therefore important to note that whilst you may be eligible to purchase your property based on eligibility checks, there may be other reasons why we cannot sell you your property.  Our VRTB Sales Policy provides full details about the list of properties that will be exempt from purchase under the pilot.  This includes, but is not limited to:

  • Homes where there is a legal agreement/planning restriction in place which means we cannot sell your property. We will be able to explain this to you on a case-by-case basis.
  • Homes in an excluded rural areas where there is a restriction on purchasing properties.
  • Homes in high rise apartments, including tower blocks where there are potential future large scale improvements, which provide possible complex management arrangements and potential expense.
  • Leasehold houses as the Government has said that these cannot be sold under the pilot.
  • Homes where the sale would result in the Group not being able to cover the cost of the property, and would lead to a financial loss to the Group if sold.

Please note that this list is not exhaustive and so please register your interest to be given confirmation that your property could be eligible.  If your property is exempt from the VRTB Pilot due to one of the reasons set out in our policy, and you are eligible for the pilot, we will let you know.  We will also work with you to offer you the opportunity to “port”/use your discount to purchase another suitable property in your area.  Please see our Portable Discount Policy (link to policy) for full details about how this works.

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4. What happens if I am eligible, but my property is excluded from the VRTB pilot?

If you are eligible, but we tell you that your property is exempt, you should be able to “port” your discount to purchase another suitable property in your area.  This may be one of our properties or another housing association.  Please note that there are time restrictions associated with the portable discount – this is explained in our policy and flowchart.  There are a number of factors that will determine what alternative properties will be available to you.  We will look to find suitable properties based on your need and you will also be responsible for identifying suitable alternatives via Homes Direct and other Choice Based Lettings (CBL) systems.  Registering on Homes Direct/CBL will mean that you may be able to look at porting your discount to properties available from other housing providers.  Please see our Portable Discount Policy and flow chart for full details about how this works.

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5. I currently have a shared ownership property, will I be able to purchase my home under the new pilot?

You will not be eligible for the VRTB, but please get in touch with Waterloo Homes if you would like to buy a further share in your home

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6. How much discount will I get on my property if I take part in this pilot?

The amount of discount you will receive on your property will be determined by a calculation set by the Government.  The discount is worked out in an identical way to the statutory Right to Buy for council tenants. You can find out roughly how much discount you may get by using the discount calculator on the Right to Buy website

  • For each complete year of confirmed tenancy, you are entitled to receive a discount based on a percentage of the open market value of the property. The total periods of qualifying tenancy are added together (years, months, days) and the discount is calculated on the total years. The monetary value of this percentage is deducted from the market valuation of the property.
  • For freehold sales (where you will own the property outright, including the land it’s built on) a tenant is awarded a 35% discount for the first five years and a further 1% for each additional complete year of confirmed tenancy, up to a maximum of a 70% discount – or £80,900, whichever is lower.
  • For leasehold sales (where you will own the property and its land for the length of your lease agreement) a tenant is awarded a 50% discount for the first five years and a further 2% for each additional complete year of confirmed tenancy, up to a maximum of 70% – or £80,900, whichever is lower.
  • The maximum discount will be reviewed annually and increased if appropriate in line with the Consumer Price Index level of inflation (CPI).
  • If you have previously received funding under Right to Buy, Preserved Right to Buy or Right to Acquire, the discount will be reduced by that amount.

Example:  Mrs Stevens has been a public sector and/or housing association tenant for 10 years.  Her 2 bedroom house has been valued at £150,000.

Current house value: £150,000

Years as a tenant: 10 years

Eligible discount: (35% + 1% for each year over 5 years) = 40%

Discount value: £60,000

Amount Mrs Stevens will pay for house (£150,000 - £60,000) = £90,000

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 7. What happens when I have bought my property?

Buying a home is a big decision.  It is important that you think carefully about the responsibilities, costs and other commitments that this will bring. These can include:

  • Repairs & maintenance to the property - Waterloo will no longer be responsible for maintaining your property.
  • Possible service charges - where applicable - we will let you know if this applies when you enquire about purchasing the property.
  • Insurance costs – you must have buildings insurance for the property and we would strongly recommend having contents insurance as well.
  • Legal costs – including costs of solicitor and conveyance
  • Other costs – Land registry fee, removal costs etc.

We recommend that you look into the costs of home ownership before you get too far into the VRTB process.  You are responsible for arranging how you finance your purchase and obtaining the necessary advice on this.  Make sure whoever you get advice from is regulated by the Financial Conduct Authority (FCA).  You will be asked to confirm that you can afford the property that you are looking to purchase.

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8. What happens if I sell my property after I have purchased it?

If you decide to sell your property within 10 years of buying it through the VRTB, we will have the first right of refusal, i.e. you must first offer the property to us.  We will let you know whether we wish to buy the property within eight weeks of you getting in touch.

You will also be required to pay back some or all of the discount if you sell your property on within the first five years as below:

  • 100% of the discount in the first year
  • 80% of the discount in the second year
  • 60% of the discount in the third year
  • 40% of the discount in the fourth year
  • 20% of the discount in the fifth year

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9. What happens if I sub-let my property after I have purchased it?

You will also be required to pay back some or all of the discount if you sub-let the property within the first five years, as below:

  • 100% of the discount in the first year
  • 80% of the discount in the second year
  • 60% of the discount in the third year
  • 40% of the discount in the fourth year
  • 20% of the discount in the fifth year

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10. I am interested, how can I apply?

The pilot has not started yet.  The Government will announce the start date.  We will provide further information about how the application process will work as soon as we can.  Here are the initial steps you will need to take once the pilot starts:

Step 1:  Will you be eligible to take part?

First check whether you are eligible for the VRTB.  You can access further information about the VRTB on the Government’s Right to Buy Website and on our VRTB Sales Policy.

Government-funded Right to Buy Agents can provide you with free and impartial advice on the rules and requirements of the scheme.  The Agents can also help you as you go through the process and advise you on issues such as affordability, costs of home ownership and fraud.

Right to Buy Agents:

Website:  www.righttobuy.gov.uk/agent-service

Email address: enquiry@righttobuyagent.org.uk

Telephone: 0300 123 0913

Step 2: Register your interest and apply to get a Unique Reference Number from the Government

If you believe you are eligible for the VRTB you will have to register your interest on the Government’s VRTB website and apply for a Unique Reference Number (URN).  This website will be launched once the pilot starts.

This is a really important step as we will not be able to send you an application form unless you can confirm your number.  A limited number of URNs will be available and not every applicant will be able to receive one.  Please note that, even if you do receive a URN, there is no guarantee that you will be able to buy your home.  This depends on the eligibility of your home and its affordability to you.  If you receive a URN, it will only be valid for four weeks from receipt.  After that it will expire and you will no longer be able to apply.

The Government will decide when to stop issuing URNs depending on how much funding it has left for the pilot - we cannot influence this.  If this is the case, you will need to wait until it reopens before applying a URN.

Our VRTB Customer flowchart explains what happens after you have obtained your URN.

Things to note:

  • There are strict timescales associated with the sales process. It’s important that you keep to the timescales as if you do not it may result in your application being cancelled.  These are explained in our VRTB customer flowchart and Portable Discount flowchart. Our VRTB Sales Policy and Portable Discount Policy also sets out further details about what is involved in the process.
  • You will be required to submit several pieces of information as part of the application process. This will allow us to check that you are eligible to take part.  We may suspend an application at any time during the application process if we suspect fraud or money laundering.  Our VRTB Sales Policy provides further information about this.
  • You will have to pay us a £250 administration fee. This will be refunded either when the sale is completed or if we have to turn you down because you do not meet the eligibility requirements. You will not be refunded if you decide to stop proceeding with the sale – for example, due to difficulty of raising the funds.
  • As part of the process set by the Government we will have to ask the Government for approval before we can complete the sale. This means that there may be occasions where we have to refuse the sale as the Government has told us we cannot proceed due to a shortage of funding.  If this is the case, we will let you know.

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11. Where can I get further information?

Think twice before getting advice from any agency that asks you for money to help you.  They may be asking you to pay for advice you could just as easily get free of charge from one of the below resources:

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