Repaying discount and selling your home

Once you have purchased your home from us you can sell it on the open market whenever you wish.

If you sell within the discount repayment period (further detail below) you will have to repay some or all of the discount. The amount you repay will depend on when you made your application to buy.

If you applied to buy your home before 18 January 2005 and sell within 3 years of buying your home:

If you sell within the first year after your purchase the whole of the discount will have to be repaid,
66% within the second year and
33% within the third year.

After 3 years you can sell without repaying any discount.

If you applied to buy your home from 18 January 2005 onwards and sell within 5 years of buying your home:

The calculation for repayment takes into account any change in the valuation of your home since you bought it, disregarding any improvements you have made.
The length of time since you bought is also taken into account, if you sell within the first year of purchase the whole discount will have to be repaid. 80% is repayable within the second year, 60% within the third year, 40% within the fourth year and 20% within the fifth year. After 5 years you can sell without repaying any discount.

Example:

If when you bought under Right to Buy, the house was valued at £200,000,
and you were allowed a discount of £38,000, the discount you were allowed was 19% of the value.

If three years later you decide to sell your home, and you get an offer of £300,000 the ‘discount’ element for repayment is: £300,000 x 19% = £57,000

As you are selling in the third year 60% of the ‘discount’ element is repayable: £57,000 x 60% = £34,200.

There are some exceptions to repaying discount, e.g. for sales to an existing joint owner, spouse, former spouse or a member of the family living in the property.

Last modified 03/04/09