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The New Right-to-Buy and 'Benefits to Bricks' Schemes: Making Homeownership a Reality

If you're finding it increasingly difficult to step onto the property ladder, you're not alone. With soaring house prices outpacing earnings, buying a first home has become a significant challenge, especially for those with lower...

If you're finding it increasingly difficult to step onto the property ladder, you're not alone. With soaring house prices outpacing earnings, buying a first home has become a significant challenge, especially for those with lower incomes. However, there is good news on the horizon. The government has recently unveiled a series of housing reforms aimed at making homeownership accessible to millions more people. Let's delve into the details of these schemes, explore who can benefit from them, and assess the broader market outlook for first-time buyers.

Extending the Right-to-Buy Scheme

The key proposal is the extension of the existing right-to-buy scheme to housing association tenants. This means that those currently living in housing association properties will have the opportunity to purchase their homes at a discounted rate. This reform could benefit approximately 2.5 million households, and to ensure the housing supply remains strong, the government pledges to build a new social home for every home sold.

Benefits for Bricks: Easier Mortgage Approval

In addition to the right-to-buy extension, the government has announced plans to streamline the welfare rules to facilitate mortgage approval. Dubbed 'benefits for bricks', this reform allows individuals in low-paid work who receive housing benefits to have their welfare payments considered as income when applying for a mortgage. This means that a greater number of people will be able to meet the mortgage affordability criteria.

Positive Changes for Universal Credit Recipients

Furthermore, individuals currently receiving Universal Credit will also benefit from these housing reforms. Presently, Universal Credit eligibility is affected when savings exceed £6,000 and ceases completely when they surpass £16,000. To incentivize saving for homeownership, the government intends to exempt Lifetime ISA savings from these rules. As a result, you can save for a home without jeopardizing your eligibility for Universal Credit.

Understanding the Right-To-Buy Scheme

The right-to-buy scheme was introduced by former Prime Minister Margaret Thatcher in 1980, granting council tenants the opportunity to purchase their homes at discounted rates. Since its inception, nearly 2 million homeowners have benefitted from this scheme. To be eligible for the right-to-buy scheme, certain criteria must be met, including using the property as your primary residence, occupying a self-contained unit, possessing secure tenancy, and having a public sector landlord for at least three years.

While the number of people eligible for the right-to-buy scheme is limited, the discounts on offer can be enticing. The exact level of discount depends on whether you live in a house or a flat, with flat rates generally offering more significant discounts. For example, if you have been a public sector tenant for three to five years, the discount is 50% for flats compared to 35% for houses. The discount increases by 2% each subsequent year, reaching a maximum cap of 70% of the home's market value, up to £87,000, or £116,200 for homes in London.

It's important to note that these rules apply specifically to homes in England. Different regulations govern the right-to-buy scheme in Northern Ireland, Scotland, and Wales.

Market Outlook for First-Time Buyers

Even if you are not reliant on state or housing benefits, purchasing your first home can still be challenging. According to Halifax, the average UK house price has risen to nearly £290,000, an increase of 10.5% in the past year alone. Accumulating a sufficient deposit has become increasingly difficult, which is reflected in the fact that only 31% of millennials currently own a property.

However, amidst this seemingly daunting landscape, there are reasons to be optimistic. Prudent financial planning can make homeownership well within your reach. Government initiatives, such as the Lifetime ISA, provide the opportunity to save a tax-free lump sum specifically for your first home deposit. Additionally, the government offers a bonus of up to £1,000 per year to boost your savings.

To explore further information about how the Lifetime ISA can help you realize your homeownership goals, check out our recent article. Additionally, consider improving your credit score to instill confidence in lenders regarding your borrowing capacity. We have a handy guide on how to enhance your credit score, which you can find here.

Seeking Expert Assistance

It's crucial to approach the decision of buying a home, whether through the right-to-buy scheme or independently, with careful consideration. We strongly advise seeking professional advice before taking the leap. At Unbiased, we offer a mortgage calculator that can estimate your borrowing capacity and connect you with expert mortgage advisers. They will recommend the best course of action based on your specific circumstances, ensuring that your first mortgage repayments are affordable now and in the future.


While the challenges of homeownership may seem overwhelming, recent housing reforms aim to make this dream a reality for more aspiring homeowners. The extension of the right-to-buy scheme and the benefits for bricks reform offer financial support to those who need it most. Coupled with government initiatives like the Lifetime ISA, there are plenty of opportunities to save and achieve your homeownership goals. Remember to seek professional advice to ensure you make informed decisions and navigate the complex process of purchasing a home successfully.