Right to buy leaflet - Orkney Islands Council

Buying Your Home: Your Rights and Responsibilities
1.1 Introduction
This leaflet provides you with general information about buying your
council home. It also explains the implications of the Right to Buy,
including responsibilities after you buy your home.
This leaflet is not intended as a precise statement of the law but as a
plain language guide. This complements other information that we
make available to tenants. For example, the Scottish Executive's
booklet "Your Right to Buy Your Home".
The leaflet covers the following issues:
our policy on the Right to Buy
the Right to Buy scheme explained
your responsibilities
miscellaneous
applying to buy
limitations on the Right to Buy
the use of the property after it has been purchased
The word "house" is used in this leaflet to cover all house types in
Orkney.
This leaflet can be made available in other languages, on request,
and in different formats such as in large print, tape or Braille.

1.2 Our Policy on the Right to Buy
We have established a detailed policy to ensure that we implement
the Right to Buy scheme effectively throughout Orkney. Our main
policy commitments include:
meeting legal and good practice guidance
advising existing and new tenants of their rights and
responsibilities
providing information on agencies that can provide support to
tenants who want to buy their homes, for example, financial
advice
promoting staff training
monitoring of performance to assess if we are meeting our legal
obligations
reviewing our policy regularly in consultation with tenants
1.3 The Right to Buy Scheme Explained
This section explains the following matters:
the two types of Right to Buy
rights and responsibilities under the two types
houses that cannot be sold
(a) The Two Types of Right to Buy
All Scottish secure tenants have the Right to Buy under the Housing
(Scotland) Act 1987. The Housing (Scotland) Act 2001, however,
made important changes to the Right to Buy scheme and introduced
what is called the "modernised Right to Buy". These new rights came
into force on 30th September 2002. This section now explains what
this means for tenants.

The Old Right to Buy
(Tenancies before 30th
September 2002)
The old Right to Buy terms
continue to apply to Council
tenants who held their tenancy
before the 30th September
2002. It is important to note,
though, that this does not apply
if you:
transfer to another
Council or Housing
Association house, or
exercise your right to
exchange your home with
another Scottish secure
tenant
assign, that is, transfer or
pass on your tenancy to
someone else
The Modernised Right to Buy
(Tenancies after 30th
September 2002)
The modernised Right to Buy
terms apply, in general, to new
tenancies created on or after
the 30th September 2002. This
does not apply, though, if:
the tenant's spouse (or
partner or joint tenant)
succeeds to the tenancy
on the death of the tenant
who was a tenant before
the legal changes.
we provide the tenant
with other housing in
order to demolish their
existing home
we recover possession of
the tenant's house and
provide them with another
house
(b) Rights and Responsibilities Under the Two Types
This section explains the main rights under the old and new Right to
Buy schemes. You may, then, simply refer to the section that applies
directly to you.

The Old Right to Buy scheme: Your Rights
Before you can buy your home, you must have been a tenant of one
of the eligible landlords. You must also have occupied a tenancy for
at least two years and it must have been your only or main home.
Eligible landlords include various public sector landlords including
local authorities and housing associations. And occupation should be
continuous during this period, although we may disregard this. For
instance, if interrupted occupation occurs because of circumstances
beyond control such as fleeing domestic abuse.
You may purchase your home with other family members such as
your spouse, partner or children. Family members must:
be at least eighteen years old
have lived with you throughout the last six months as their only or
principal home
The main financial benefit to tenants who purchase under the Right to
Buy scheme is the level of discount. This enables tenants to buy their
homes at market value less the appropriate discount.
Houses and flats are treated differently when calculating discounts.
Discounts are calculated as follows:
Houses
Tenants are eligible for a discount of 32% for houses after two years
occupation. Discount rises by 1% each year to a maximum of 60%. It
takes thirty years to reach the maximum.
Flats
Tenants are eligible for a discount of 44% for flats after two years
occupation. Discount rises by 2% each year to a maximum of 70%. It
takes fifteen years to reach the maximum.

The Modernised Right to Buy Scheme: Your Rights
This section outlines the key provisions under the modernised Right
to Buy scheme.
Before you can buy your home under the modernised Right to Buy
scheme, you must have been a tenant of one of the eligible landlords.
You must also have occupied a tenancy for at least five years and it
must have been your only or main home.
Unlike the original Right to Buy scheme, houses and flats are treated
the same for purposes of discount calculation. The minimum discount
after five years occupation is 20%.
This increases by 1% each year to a maximum of 35%, or £15,000
whichever is the lower amount.
It takes twenty years to reach the maximum discount level, although
the capped price of £15,000 might be reached sooner.
Limitations on discount
You should note, however, that a house cannot be sold for less than
what is known as the “cost floor”. The cost floor rules exist to prevent
a property being sold at a price less than the amounts invested in the
property. This covers costs such as acquisition, construction, repairs
and administration.
A house may not be sold for less than these costs for the preceding
ten year period.
Discount may also be less if you have already received a previous
discount. This would apply, for instance, if you have previously bought
a house through the Right to Buy.

Recovery of Discount
If you sell your home within three years after purchase, you must
repay part of the discount unless one of the exceptions applies.
The amounts of discount recoverable are as follows:
Resale of property
Year 1
Year 2
Year 3
Discount to be Repaid
100% (all of discount)
66% (two thirds of discount)
33% (one third of discount)
You do not need to repay the discount if:
one of the purchasers disposes of the property to another joint
purchaser
the purchaser disposes of their part of the house but continues to
occupy the remainder of the property as their principal home
the disposal is made by an executor, for example, winding-up the
estate
the disposal is due to a compulsory purchase order
the disposal is to a member of the owner’s family who has lived
with the owner for twelve months before the disposal
You may also be required to repay all or part of the discount you
received, if you fail to occupy the property for the initial three year
period. This may apply for instance if you rent the property out during
this time without the prior written consent of the Council.
Other limitations
A number of other factors may affect your Right to Buy. For example,
individuals may be unable to buy their homes if an area is designated

as being a “pressured area” This refers to areas where demand for
housing greatly exceeds supply.
Again, we may seek permission from Scottish Ministers (through the
Scottish Executive) to refuse to sell houses that are scheduled for
demolition.
We will also refuse to sell Council housing if the tenant owes rent,
council tax or water and sewerage charges or other amounts owing
as a result of your current or a previous tenancy.
Finally, tenants may be unable to buy their home if we have served a
legal notice because of their conduct. For example, notice may be
served if a tenant or other occupier is responsible for anti-social
behaviour.
(c) Houses that cannot be sold
There are a number of exemptions to the Right to Buy scheme, for
example, housing that is part of a group of housing designed to meet
particular needs. In Orkney, this applies to sheltered housing, core
and cluster housing, supported accommodation and houses not
owned by the Council.
1.4 Your Responsibilities
Buying your home involves a number of important responsibilities.
These should be considered carefully when considering house
purchase. Key issues to consider are as follows:
repairs
insurance
use of property
1.4.1 Repairs
Until you complete the purchase, we are responsible for maintaining
the structure and exterior of the house; we are also responsible for

maintaining specific installations such as central heating.
Although the Right to Repair scheme continues until such time as a
property has been sold, the same does not apply to capital
improvement works. Once an application to purchase has been
submitted, we will halt plans to carry out improvements outwith our
Right to Repair commitments. For further information on the Right to
Repair scheme please see our separate leaflet.
You should remember, though, that after the sale is completed, you
are responsible for all external and internal repairs. You may also be
liable for paying shared costs towards maintaining common areas, for
example, common repairs to tenements or landscaping costs.
Information about this - and other matters - is contained in the title
deeds or deed of conditions. The deed lays down the responsibilities
of owners regarding such matters as maintenance and insurance
obligations.
1.4.2 Insurance
You are responsible for insuring your property once the sale is
completed. The deed of conditions requires you to keep the property
fully insured through an established insurance company; while our
Standard Security document specifies the level of insurance cover.
The Standard Security also details the amount of discount to be
repaid should the house be sold again within three years.
1.4.3 Use of property
You should also note that the use of the property is also covered by
the deed of conditions. For example, the house should not be used in
any way that is liable to be a nuisance or disturbance to other people.
Again, the house should be used for private residential purposes only
and not as a business.
If owners fail to comply with the terms of the deed of conditions, the

Council may raise legal action to enforce them.
There are also regulations concerning use of the property once the
sale is completed. For example, lenders normally prohibit subletting
of homes without permission. This is generally a condition of the loan
being approved. (See footnote)
The Discount Security Document must be signed before the purchase
completes. This requires the new owners to occupy the property
for the initial three year period and therefore it cannot be rented
out during this time without the prior written consent of the
Council. Any breach of this could result in you being required to
repay all or part of the discount you received.
You should discuss all of these matters with an advisor or your
solicitor before buying your home.
Footnote
The council was previously the lender of last resort if tenants were
unable to access a loan from another source. This no longer applies.
1.5 Miscellaneous
We recognise that the Right to Buy scheme is extremely important
with major implications for tenants' welfare. It is essential, therefore,
that tenants receive quality advice and information at the point of
considering house purchase.
Initiatives that we have undertaken to ensure quality advice and
information services are as follows.
Firstly, we provide tenants with information about buying their homes
before they sign their tenancy agreement. This includes information
about the implications of house purchase and the restrictions which
follow this. We do this by giving tenants a copy of this leaflet.
Secondly, we provide tenants interested in buying their homes with a

list of appropriate agencies that can offer specialist advice. We also
offer to arrange meetings to facilitate this process. A list of contacts is
provided at the end of this leaflet.
1.6 Applying to Buy
Full details on how to apply to buy are available at the One Stop
Shop, School Place, Kirkwall, Orkney, and the Cash Collection Office,
Ferry Road, Stromness, Orkney.
This section summarises the main stages concerning applying to buy.
Any tenant who wants to buy their Council house, must submit an
application to purchase to the Council. Unless the Council is disputing
an application, we must serve an offer to sell within two months. We
may pay compensation to tenants if we fail to meet the legal time
scale. Details are contained in the Council’s Policy on the Right to
Buy.
The tenant must then serve a notice of acceptance within a further
two months. After this notice is received, the Council will exchange
missives with the tenant’s solicitor. The missives are the letters
exchanged by the Council and the tenant’s solicitor to constitute a
legally binding contract.
You should note that tenants may refer disputes to the Lands
Tribunal. The Lands Tribunal deals with disputes concerning refusals
to sell and conditions of sale.
1.6 Conclusion
The Right to Buy is an important right for tenants. This applies in the
case of both forms of the Right to Buy, although the modernised Right
to Buy scheme may be less attractive financially.
We implement the Right to Buy scheme in accordance with legal
requirements. But it is also important that tenants are aware of the
many pitfalls associated with home ownership. For this reason, we

ensure that tenants considering purchase receive impartial and
quality advice.
For further information on the Right to Buy please contact:
Allocations Section
Housing Division
Orkney Islands Council
School Place
Kirkwall
Orkney
KW15 1NY
Tel: (01856) 873535 ext
2182
Fax: (01856) 886530
E-mail:
housing@orkney.gov.uk
Citizen’s Advice Bureau
Anchor Buildings
Bridge Street
Kirkwall
Tel:- (01856) 875266
Housing Advice &
Information Service
Housing Division
Orkney Islands Council
School Place
Kirkwall
Orkney
KW15 1NY
Tel: (01856) 873535 ext
2175
Fax: (01856) 886530
E-mail:
housing@orkney.gov.uk
The Lands Tribunal for
Scotland
1 Grosvenor Crescent
Edinburgh
EH12 5ER
Tel: 0131 225 7996
Fax: 0131 226 4812
E-
mail: mailbox@landstribunal-scotland.org.uk
Legal Services Division
Orkney Islands Council
School Place
Kirkwall
Orkney
KW15 1NY
Tel: (01856) 873535
Fax:- (01856) 874615
E-mail:-
legal.services@orkney.gov.uk
If you wish to make any comments on this leaflet please contact the
Housing Division, at the address shown above.