From 26 May 2015, the qualifying period for the right to buy, the preserved right to buy and the right to acquire will reduce from five to three years.
This change reflects the current government’s policy to support the rights of tenants to purchase their homes. The reduction in the qualification period follows this month’s increase of the maximum cash discount to £77,900 (£103,900 in London) for the right to buy and the preserved right to buy.
The discount for those who have a qualifying period of three to five years will be the standard base line amount of 35% of value for houses and 50% of value for flats.
Under the right to acquire, the much lower set discounts of £9,000 – £16,000 (subject to area) will apply.
The reduction in the qualifying period for the right to acquire is not expected to have much impact on take up, given that last year only 240 housing association tenants exercised their right to acquire (compared with 4,421 housing association tenants who exercised the preserved right to buy).
The changes to the qualifying period and the current discounts are potentially all subject to change with the upcoming election and tenant’s rights to purchase becoming a battleground for the main parties.
The conservatives have confirmed their policy of extending the right to buy discounts to those housing association tenants who qualify for the right to acquire – something that the liberal democrats and the labour party oppose (as well as the vast majority of the sector).
For the time being and until a new government is elected and makes further changes to tenants’ rights to purchase these changes will apply and steps should be taken to update policies and procedures.
For more information on this article please contact Nicki Winstanley at nwinstanley@hylandlegal.uk or on 0161 312 3400.
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