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Buying and selling your leasehold
You do not need the council’s permission to sell your flat, although the council must be informed of any change of ownership. If you have bought your home under Right to Buy, you can sell it whenever you like. But if you wish to sell within the ‘discount repayment period’ you will usually have to repay some or all of the discount. The amount you repay will depend on when you made your application to buy. The following section provides further information on selling your home and repayment of discount. If you want to sell your home, you will need to be aware of the following points:
Repaying any discount
We work out the discount you must repay to the council depending on when you sent your notice to the council claiming the right to buy. For most of the council’s leaseholders it is as follows: If you bought your flat under the right-to-buy scheme less than three years ago, you will have to repay a percentage of the original discount, as follows:
- Within year one - you must repay the full discount
- Within year two - you must repay two-thirds of the discount
- Within year three - you must pay one-third of the discount
- After three years - you do not repay any discount
However, if you sent your notice claiming the right to buy (RTB1) after 18 January 2005, when you come to sell, the following calculation will apply. We will work out the discount you were entitled to when you bought as a percentage of the original value. The same percentage of the value of the property when you come to sell (less any improvement value) will be taken to apply over five years rather than three years as above. So, the percentages will be as follows.
- Within year one -100% Within year two - 80%
- Within year three - 60% Within year four - 40%
- Within year five - 20%
For example, if when you bought the property you received a discount of £30,000 and the property was valued at £120,000, the discount represented 25% of the value. When you come to sell, if the value of the property is £150,000 the percentages above will apply against £37,500, which is 25% of the new value.
Legal costs
We will charge your solicitor or estate agent for any enquiries they make for your proposed sale and providing the information needed. Some delay is inevitable in providing the information asked for as we will need to gather information from other departments.
Transferring your lease
Your solicitor will be responsible for making sure that we receive a copy of the notice of assignment. We make a small charge for this notice.
Service charges
You are responsible for paying your service charges for the whole of the financial year in advance. When you sell it is usual to agree an adjustment with the new owner and to make allowance for any overpayment which may occur by the end of the year. You should make sure that your solicitor sorts this out with the new owner.
Passing on your lease if you die
When you die, the right to your lease will normally pass to your nearest family member unless you have said otherwise in your will. If you die without leaving a will (called ‘intestate’ in legal terms) giving clear instructions about who the property should go to, the courts will deal with your estate. The discount repayment clause does not apply in these circumstances.
Staying in your home
You are secure in your home as long as you keep to the terms of the lease. Only a court can allow your home to be taken from you. This could happen if, for example, you failed to pay your service charge, or mortgage, or you knowingly made false statements when you applied for the lease.
