Refusing Right to Aquire discount

[Deleted User]

My son lives in a housing association home and wants to purchase the property. He is entitled to the 9k discount however wants to refuse the discount and Purchase without any of the rules that come with the discount? For example unable to sell within five years or release equity. 

He has lived in the property for 12 years. He has contacted the housing association who do not seem to know. Anyone been through a similar situation? 

EDIT:
To clarify, he will be getting a 50% mortgage on the property and plans to release equity in the property after two years so I can move in. He does not want to move. He has been told he will not be able to release equity for 5 years due to the discount. It is only 9K and he is happy to pay the FULL MARKET VALUE

[Deleted User]

Jaynie87 said:

My son lives in a housing association home and wants to purchase the property. He is entitled to the 9k discount however wants to refuse the discount and Purchase without any of the rules that come with the discount? For example unable to sell within five years or release equity. 

He has lived in the property for 12 years. He has contacted the housing association who do not seem to know. Anyone been through a similar situation? 

 He can't just purchase without the rules. The rules are there to protect public housing and money. The right to acquire is there to house people not to help residents make money. 

Norman_Castle

He can sell within five years but may have to repay part of the discount. Why does he want to buy in this way?

AdrianC

Jaynie87 said:

My son lives in a housing association home and wants to purchase the property. He is entitled to the 9k discount however wants to refuse the discount and Purchase without any of the rules that come with the discount? For example unable to sell within five years or release equity. 

He has lived in the property for 12 years. He has contacted the housing association who do not seem to know. Anyone been through a similar situation? 

It makes no sense...

He buys with discount.
If he sells in a situation where the discount would be repayable, he repays it and is no worse off than he would have been had he paid full-value in the first situation.
If he doesn't sell in a discount where the situation would be repayable, he is better off by the value of the discount.

Somehow, I suspect this isn't about the financials, but about other restrictions - perhaps letting the property?

If he's happy to pay full market value, why not buy a non-HA place?

FtbDreaming

He can’t refuse the discount. If he sells within 5 years he’ll have to pay some or all of the discount back. If he sells within ten he still has to give the housing association first refusal. If he’s buying with the intention of selling on the open market straight away he can’t. He has to offer it back the the HA who will only pay market value so he won’t make a profit. 

[Deleted User]

_shel said:

Jaynie87 said:

My son lives in a housing association home and wants to purchase the property. He is entitled to the 9k discount however wants to refuse the discount and Purchase without any of the rules that come with the discount? For example unable to sell within five years or release equity. 

He has lived in the property for 12 years. He has contacted the housing association who do not seem to know. Anyone been through a similar situation? 

 He can't just purchase without the rules. The rules are there to protect public housing and money. The right to acquire is there to house people not to help residents make money. 

Who said it was to make money? You assumed that! He wants to refuse the discount and pay full market value. I do not see a problem. He can purchase a non-housing association home but would rather stay in the property and extend but will need to release equity after 2 years to enable him to extend so I can move in due to personal circumstances that are non of your business! Make as many assumptions as you wish!

[Deleted User]

Norman_Castle said:

He can sell within five years but may have to repay part of the discount. Why does he want to buy in this way?

He wants to refuse the discount so he doesn't have any restrictions. This is so he can release equity to extend so I can move in.

[Deleted User]

AdrianC said:

Jaynie87 said:

My son lives in a housing association home and wants to purchase the property. He is entitled to the 9k discount however wants to refuse the discount and Purchase without any of the rules that come with the discount? For example unable to sell within five years or release equity. 

He has lived in the property for 12 years. He has contacted the housing association who do not seem to know. Anyone been through a similar situation? 

It makes no sense...

He buys with discount.
If he sells in a situation where the discount would be repayable, he repays it and is no worse off than he would have been had he paid full-value in the first situation.
If he doesn't sell in a discount where the situation would be repayable, he is better off by the value of the discount.

Somehow, I suspect this isn't about the financials, but about other restrictions - perhaps letting the property?

If he's happy to pay full market value, why not buy a non-HA place?

He wants to refuse the discount so he can release equity. He has been advised he will be unable to do so. He only need a 50% mortgage and after two years plans to release equity to extend the property so I can move in.
He plans to stay in the property and has no intention to let out the property. He has spent the last 20 years of his life saving. He doesn't want to move from a place where he has lived for 12 years and is happy. I do not see the problem if he wants to purchase at full market value. I was just asking for advice regarding this situation, did not expect for people to make assumptions.

AdrianC

I really can't see what the issue is with "releasing equity".

Why can't he remortgage?
Even simply borrow more than he needs now, and retain his cash invested elsewhere?
How does paying more than needed for the property help him access money in two years?

Can you give us some examples of figures...?

For example...
£120k property
£60k cash, £60k mortgage.
In two years, £30k needed to extend...

Going with those figures...
£111k post-discount purchase
£30k cash, £81k mortgage
In two years, he still has his £30k cash available to him, no need to refinance.

tinytiddles

Jaynie87 said:

AdrianC said:

Jaynie87 said:

My son lives in a housing association home and wants to purchase the property. He is entitled to the 9k discount however wants to refuse the discount and Purchase without any of the rules that come with the discount? For example unable to sell within five years or release equity. 

He has lived in the property for 12 years. He has contacted the housing association who do not seem to know. Anyone been through a similar situation? 

It makes no sense...

He buys with discount.
If he sells in a situation where the discount would be repayable, he repays it and is no worse off than he would have been had he paid full-value in the first situation.
If he doesn't sell in a discount where the situation would be repayable, he is better off by the value of the discount.

Somehow, I suspect this isn't about the financials, but about other restrictions - perhaps letting the property?

If he's happy to pay full market value, why not buy a non-HA place?

He wants to refuse the discount so he can release equity. He has been advised he will be unable to do so. He only need a 50% mortgage and after two years plans to release equity to extend the property so I can move in.
He plans to stay in the property and has no intention to let out the property. He has spent the last 20 years of his life saving. He doesn't want to move from a place where he has lived for 12 years and is happy. I do not see the problem if he wants to purchase at full market value. I was just asking for advice regarding this situation, did not expect for people to make assumptions.

Unfortunately Housing Associations are only permitted to sell social assets via Right to Acquire or Right to Buy (if it owns ex-Council homes). Any other open market asset disposals (sales) have to be agreed as a one-off by the Board and notified to the Regulator. 

As others have already said, the easiest way to release equity on the property later on would be to remortgage and take a higher loan. Most people who buy via RTA or RTB do this to be able to afford home improvements. 

HampshireH

"I do not see the problem if he wants to purchase at full market value. I was just asking for advice regarding this "

Because it isnt for sale. 

The right to aquire is a benefit/privilege. Social housing isnt just available to buy on request it comes with rules ans terms and conditions which cannot be bypassed