A London council has set up a system to allow council tenants to buy into a shared ownership scheme which it is calling Right To Invest - but the system is seeking to avoid losing stock to private landlords.
Barking and Dagenham council says that tenants who meet the normal criteria for Right To Buy often find they are unable to get mortgages or are struggling to repay them.
“As a result we have developed this scheme which makes owning a part of your home much more affordable. You only need to get a mortgage for the shares you wish to own, not the full value of the property, and you pay the rest as a percentage of your current rent” says a statement from the council.
Tenants can buy 25 to 70 per cent of their home and if they wish to sell the share they must give the council first refusal before going to the open market.
“Barking and Dagenham is proud to be a working class borough, and we want to help our residents reach their housing aspirations. We do not want our current residents to be forced out because they cannot afford to stay” the council’s statement continues.
A Barking and Dagenham tenant in a home currently valued at £270,000 and entitled to a discount of £94,500 could buy 50 per cent of the property for £87,750.