Your landlord may offer you money to give up your council or housing association flat or house and buy a home instead.
Cash incentive schemes to buy a home
You may be able to apply for money to help you buy a home if you agree to give up a flat or house you rent from the council or a housing association.
Many social landlords provide cash grants to encourage tenants to move out of their homes. The grant can be used to help pay for a property to occupy as your home.
Some landlords offer the cash incentive payment as a loan which you must repay when you sell your home. It will be registered as a charge on the home you buy.
You are more likely to be accepted by a scheme if you are considering giving up a home that's too big for your needs.
Eligibility for cash incentive schemes
To be eligible for a cash incentive scheme, you must usually be:
- a secure council tenant or an assured housing association tenant and have no rent arrears
- able to afford a mortgage deposit and mortgage payments
- unable to afford to buy without financial help from the scheme
You won't be eligible if you owe any council tax or overpaid housing benefit or already own a property.
Type of home can you buy
Cash incentive schemes allow you to buy most types of houses or flats on the open market. You can buy a freehold or leasehold property.
Some schemes allow you to use the money to buy a shared ownership home.
The schemes won't allow you to buy:
- a mobile home or houseboat
- a leasehold home without much time left on the lease
- a home in poor condition
Cash incentives and the right to buy
Cash incentives are not available to tenants who want to use the right to buy their council house or housing association home.
You might be able to use the:
A new right to buy a housing association home has also been proposed.
Availability of schemes
Not all councils or housing associations offer this type of scheme.
Cash grant schemes are more common in areas where there's high demand for council and housing association homes.
Amount of payment
The amount of payments vary.
You may be offered more if you are giving up a house rather than a flat or depending on the number of bedrooms in your home.
How payment is made
Your landlord arranges for the money from a cash incentive scheme to be paid to your solicitor, not directly to you.
The money is paid by the date you complete the purchase of your new home.
Your landlord usually only pays the money if:
- everyone has moved out of your rented home and it's empty
- your rented home is left in good condition
- you don't owe your landlord any money
Get financial help and advice
Always get independent financial advice before you decide to buy a home.
Independent financial advisers should be registered with the Financial Conduct Authority. They usually charge you for their services.
Get advice from your local advice centre on your housing options.
Last updated 14 Jan 2015 | © Shelter
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