Right to Buy is a scheme for council tenants to buy their homes at a large discount.
Below are some of the criteria:
The property is your prime residence and only home
You are a secure tenancy (This a Legal contract between you and the landlord for the property).
Your landlord is an organisation live a Council or Housing Association.
An application can be made single or multiple people who have lived with you and are on the tenancy agreement. Right to buy can be discounts can be upto 70% or in the region of £100,000 but these figures need to verified by each person applying.
Start by making enquires to get an understanding of how the mechanisms around Right to Buy work so that you can get an understanding of how things work. If you are able to, start to accumulate the information before you are in a position to purchase.
High Rise Flats
High rise flats are often popular because they are often in popular locations where other types of properties like apartments and houses can be much more expensive. Also, apartments in traditional blocks tend to be larger.
High rise properties are distributed all over the UK.
There are only a limited number of mortgage companies that will lend on high rise council flats as they have various concerns:
The building are made concrete from construction
Fire prevention and concerns of containment.
How suitable they are as properties for people who live in.
Ex-local Authority Block
Lenders don’t like to lend on Ex-Council authority blocks
Some lenders consider these types of property to be un-mortgageable as they can have very high service changes. High service charges are very common in these types of properties. Some of the areas of concern are:
The installation on new lifts
Renewing communal areas etc
Many potential buyers are also not keen on this type of property and this reduced demand generally cases the prices of these types of properties to be reduced. This again is another reason why many lenders won’t lend on this type of property. A large range of these types of Ex-local authority apartments are advertised as “Cash Purchase” due to the difficulties in getting a mortgage.
Mortgage
Different mortgage lenders look at high rise flats differently. Start by making enquires with all the organisations you bank with. Also make enquires with a few mortgage brokers and try to find brokers who specialise in giving mortgage for high rise properties. Some mortgage companies will be more willing to give mortgages in locations like London.
Additional restrictions is that some mortgage companies will not lend on blocks that are greater than four or five stories high.
Lenders are also concerned that the demand for council blocks can also change which can affect the valuation as these flats can fall in price. Which could potentially mean the mortgage company could lose money as they may have given mortgages on this type of property all over the country.
Many lenders make adequate home insurance a priority before the will release mortgage funds to a buyer. Home insurance can also be something that is difficult to secure on a high rise property, as insurance companies are aware that they could end of paying out large sums for these types of properties
Many high rise flats across the Uk have fallen in a state of disrepair and decay. Which can means that the value of these properties continues to go down.
Be aware that the problems you experience when buying this type of property, maybe the same problems you experience when you try to sell. So think about an exit strategy.
My View
Look to see how long you can own the property for, before you can sell.
Formula at strategy to possibly sell the property to purchase a property of standard construction.
Be aware of large service changes
NEXT STEPS
Start to accumulate knowledge on the right to buy process before you are ready to buy
Contact your bank and mortgage broker to learn about available mortgage