A regional pilot has been launched for what is called the Voluntary Right to Buy - a scheme giving housing association tenants the opportunity to purchase their homes at a discounted price.
Under the scheme, housing association tenants will enter a lottery for a unique reference number which will start the purchase process. The housing association will then decide whether or not to proceed with the sale.
If a sale is agreed, the tenant will be able to purchase the property at a discounted rate and the housing association will receive the full open market value of the property from central government, which includes the discount offered to the tenants.
After selling a property, the housing association is expected to replace the lost stock, either in the same geographical area or in another location where additional need is identified.
The VRTB scheme has been developed by the government in partnership with the National Housing Federation.
After an initial small-scale pilot scheme was trialled in London during 2016 and 2017, involving five housing associations, the initiative has reached the next stage and is being piloted in the Midlands.
David Orr, chief executive of the NHF, says: “Over the past three years, we have worked closely with the government on its proposal to extend the Right to Buy to housing association tenants. Of course, this pilot is not the finished product. We want to take the time to get this major endeavour right.
“It will be a success for everyone involved only if every home that is sold is replaced with a new affordable home, and if the application process is as smooth as possible for tenants.”
The new system has been welcomed by law firm Shakespeare Martineau which says it could both enlarge the owner occupation sector and encouraging housing associations to create new and improved stock.
“For smaller families who may have been living for a number of years in affordable rented accommodation, the scheme offers a route to home ownership, which may not have seemed possible previously. At the same time, housing associations should see this as a chance to rejuvenate some of their portfolios, replenish their housing stock and build new, more efficient homes” says Louise Drew, head of real estate at the firm.