Is Right to Acquire Worth It?

What is the right to acquire in the UK?

The Right to Acquire (RTA) is a government scheme that allows eligible tenants of housing association properties to buy their homes at a discount. The discount can be between £9,000 and £16,000 depending on your location, which can make home ownership much more affordable. But is the RTA really worth it? There are a few things to consider before you decide to exercise your right to acquire.

Who qualifies for the Right to Acquire?

If you've had a public sector landlord for 3 years, including any of the following:

• housing associations
• councils
• the armed services
• NHS trusts and foundation trusts

you can apply to buy your housing association home under the scheme.

You can also make a joint application to buy it with someone who shares your tenancy and up to 3 family members who’ve lived with you for the past 12 months (even if they don’t share your tenancy).

You won't be able to use the scheme if any of the following apply:

• you're in the process of being made bankrupt
• you've had to leave your home because of a court order
• you're a council tenant (if this is the case, you should see if you qualify for Right to Buy)
• you have what's termed a 'Preserved Right to Buy' (this is when you were originally a secure council tenant and the ownership of your home was transferred to another landlord, such as a housing association).

What happens if you do decide to buy your home?

You have 12 weeks to tell your landlord that you still want to buy after you've had their offer.

Should you not reply, your landlord sends you a reminder, called an RTA4. You then have a 'reasonable time' (at least 28 days to reply) after which your landlord sends a final reminder (RTA5). If you don't reply to this, your landlord can drop your application.

You can, however, change your mind at any time and continue to rent as before.

What if you disagree with your landlord's offer?

Contact your landlord within 3 months of receiving your offer and ask for an independent valuation.

This causes HMRC to send a district valuer to decide what your property is worth. When they tell you this figure, you'll then have 12 weeks to either accept this valuation figure or pull out of the sale.

What discounts do you get under the scheme?

Depending on where you live in the UK, you get a discount of between £9,000 and £16,000 on the price of your property. This could be reduced if you've previously used the scheme before or Right to Buy. Check the Table of Discounts to see how much you could save.

What happens when you come to sell your Right to Acquire home?

Your previous landlord has right of first refusal on buying your property if you decide to sell it within 10 years of exercising your Right to Acquire.

Your property should be sold at full market value, agreed mutually by your and your previous landlord, but if you can't agree, then a district valuer rules on the selling price (you don't have to pay for this).

Your landlord has 8 weeks to choose whether to buy your home, after that you can sell it to anyone you choose.

Sell within 5 years: lose some or all of your discount

You have to pay back some or all of your discount if you choose to sell up within 5 years of buying your property.

It works like this. You pay back:

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

So, Right to Acquire: Is it worth it?

Right to acquire can be a great way to get on the property ladder. However, it's important to weigh up the pros and cons carefully before deciding if its worth it.

Whenever taking the decision to buy a home, you should carefully consider whether you can afford the monthly mortgage payments and other associated costs, including stamp duty, legal fees, survey fees, lender's fees, council tax, maintenance and repairs, and insurance. It might not be worth taking the leap from renting, if you are not ready to take on the extra responsibilities of becoming a homeowner.

This is particularly relevant if the property is not in good condition. Your RICS Surveyor will prepare a report on the condition of the property. If there are defects which will be expensive to rectify, your solicitor may be able to negotiate a reduction in the price with the help of your surveyor, but you'll need to ask yourself if right to acquire is worth it based on whether you have the capacity to undertake the remediation works required.

You should also give extra consideration to how long you plan to live in the property. If you sell on within the first year, you'll lose the whole discount. Even if you move in the first few of years, you'll have to pay all the associated fees with moving again, which could eclipse what savings you get to keep. If you want to buy a home and aren't really invested in staying where you are for the foreseeable, it's probably not worth it - see if you can afford to buy elsewhere instead.

Have you decided that right to acquire is worth it?

If you've decided to buy through the right to acquire scheme, our hand selected panel of solicitors specialise in supporting first time buyers through the conveyancing process and we treat your home move like our own.




We can also help you find a suitable mortgage, with a free consultation* with one of our expert mortgage advisors.