Council tenant right to buy discounts
A right to buy applicant has the right to a discount, determined by how long they have been a tenant, the property type and any improvements to the property.
How discounts are determined
A secure tenant who qualifies for the right to buy can buy their home at a discount on the market price.
The property value is the price on the date the application for the right to buy is made.[1] The landlord must disregard any improvements made by the tenant when assessing the property value.
Factors affecting the discount amount
The discount is calculated based on the total time spent in accommodation that could contribute to the qualifying period for the right to buy, subject to the maximum discount.
Other factors include:
when the tenant's first public sector tenancy began
whether the property is a house or flat
whether the property is newly built or improved
whether a discount has previously been given to the applicant
Right to buy maximum discounts
The maximum discount a tenant can receive is the lower of:
70% of the value of the property
the maximum discount for the region
The maximum discounts for all regions were reduced from 21 November 2024.[2] Applications made after this date are subject to the new maximum discounts.
Check the current maximum discounts on Gov.uk: Right to buy.
Tenancies which started before 18 January 2005
A tenant whose first public sector tenancy began before 18 January 2005 is entitled, after their first two years of residence, to a:[3]
32% discount on a house
44% discount on a flat
The discount on a house increases by one per cent each year up to a maximum of 70 per cent after 30 years.[4]
The discount on a flat increases by two per cent each year up to a maximum of 70 per cent after 15 years.
The maximum discount is the lower of 70 per cent of the value of the property, or the maximum discount in the tenant's region.
Tenancies which started on or after 18 January 2005
A tenant whose first public sector tenancy began on or after 18 January 2005 is entitled, after their first three years of residence, to a:
35% discount on a house
50% discount on a flat
The discount on a house increases by one per cent each year up to a maximum of 70 per cent after 30 years.[5]
The discount on a flat increases by two per cent each year up to a maximum of 70 per cent after 15 years.
The maximum discount is the lower of 70 per cent of the value of the property, or the maximum discount in the tenant's region.
The qualifying period for the right to buy was reduced from five to three years on 26 May 2015.[6]
Discounts on new or improved properties
An additional limit on the amount of discount may apply where:
the property is newly built or acquired
there have been improvements, repairs or maintenance work on the property
This is known as the 'cost floor rule'.
Where the amount spent by the landlord in the last 30 years is greater than the market value of the property, there is no discount.[7]
For tenants with a preserved right to buy, the relevant period for the cost floor rule is 15 years.
Before 21 November 2024, the relevant period for the cost floor rule was 10 years. For properties built or purchased by the landlord on or after 2 April 2012, the period was 15 years.[8]
Previous discounts
Where an applicant has previously exercised the right to buy, any discount on the first purchase must be deducted from the discount they can claim on the subsequent purchase.[9]
The restriction on the discount applies whether the first discount was given to the applicant or their spouse or civil partner. This includes cases where the spouse or civil partner is now deceased.
Where the previous sale was a joint purchase, the reduction on the next sale is calculated as a proportion of the first discount.
Last updated: 21 November 2024