Can I Buy My Council House While On Benefit?

council house on benefit

Living in a council house is a more affordable housing option for families who require it. But whilst renting a council house is a good option for some, others will prefer to buy their council house. But that poses a big question – can I buy my council house while on benefit?

We’re going to answer this for you today, alongside whether you can get a mortgage while on benefit, what government schemes you can use to help you buy your council house and how much discount you could get when buying.

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What is a council house?

A council house is a form of public housing in Britain, giving families who require it a more affordable housing option. Council houses are generally built near each other alongside other facilities, like shops or schools, making up a council estate.

Council houses are built by the local authorities and will be owned by the council of your area. Council houses are more affordable because the costs are subsidised, meaning all costs including rent, ground rent, service charges etc are much lower than you would normally expect.

How do I get a council house?

In order to even be considered for a council house you need to ensure you’re eligible, which will differ depending upon your local council.

Generally speaking, you will be eligible for a council house if:

  • You’re legally homeless
  • You’re living in overcrowded accommodation or very bad housing conditions
  • You need to move because of a disability, medical, welfare or hardship reasons
  • You’re a family in a low-income group
  • You don’t have a large amount of savings
  • You have lived in a certain area for years and have a local connection, such as a job or family there

Once you know you’re eligible for a council house, you will need to join the waiting list which, depending on your area, will take a differing amount of time.

If you’re reading this and you’re currently on the waiting list wondering how to get to the front of the queue quicker, we’ve actually written an article on this, so make sure you check it out!

Can I buy my council house while on benefit?

In short, the answer to ‘can I buy my council house while on benefit’ is yes, yes you can, and you can actually make use of government schemes to help you buy – which we will give you more information on a little later.

When buying your council house while on benefit, you won’t be able to claim housing benefit anymore and you won’t be able to use any current housing benefit to cover the costs of the mortgage.

Also, if you’ve been on housing benefit to help you pay your rent, you won’t be able to claim this once you’ve bought your council house as there will, of course, no longer be any rent to pay.

One thing to keep in mind, if you have more than £16,000 in savings you shouldn’t be claiming housing benefit and so if you have this will get discovered by your local council when it comes to applying to buy your council house.

The following are benefits which you could use to buy your council house:

  • Attendance Allowance Benefit – Attendance Allowance helps you with extra costs if you have a disability severe enough that you require someone to help look after you. There are two different rates available depending on the level of help you need, and it isn’t means-tested, meaning what you earn or the amount you have in savings won’t affect the rate you receive.
  • Bereavement Support Payment (BSP) – Bereavement Support Payment is a benefit you can receive if your partner has died within the last 21 months. To get the full amount you must claim it within the first 3 months of your partner’s death, or you can claim up to 21 months after, but you will get fewer monthly payments. This support payment has replaced Bereavement Allowance, Bereavement Payment and Widowed Parent’s Allowance.
  • Carer’s Allowance Benefit – You can claim this benefit if you care for someone at least 35 hours a week and they’re entitled to a specific benefit, for example, Disability Living Allowance or Armed Forces Independence Payment. You will not get extra if you care for more than one person and if someone else cares for the same person as you, only one of you can claim this benefit.
  • Child Benefit – You’re able to claim Child Benefit if you’re responsible for looking after a child under 16 or under 20, providing they’re in approved education or training. Child Benefit is something you will receive every 4 weeks and there’s no limit on how many children you can claim for.
  • Child Tax Credit Benefit – Child Tax Credit Benefit is something you can claim if you already get Working Tax Credit, which we have explained further down this list. Child Tax Credit Benefit won’t affect your Child Benefit and you’re only able to claim Child Tax Credit for the children that you’re responsible for.
  • Disability Living Allowance (DLA) – This benefit is going to be replaced by Personal Independence Payment for disabled people and you will only be able to apply for DLA if you’re under 16. There are two different components that make up DLA, the care component and the mobility component, and you must be eligible for at least one of these in order to be able to get the benefit.
  • Employment and Support Allowance (ESA) – Employment and Support Allowance is a benefit you can claim if you have a disability or health condition that affects how much you’re able to work. You’re able to apply for this benefit if you’re employed, self-employed or unemployed.
  • Incapacity Benefit (IB) – This benefit is being replaced by ESA, which we have explained in the bullet point just above. If you’re already claiming IB you will be reassessed to decide whether you’re capable of work or eligible to claim ESA.
  • Industrial Injuries Disablement Benefit (IIDB) – You may be able to claim this benefit if you became ill or are disabled because of an accident or disease either at work or on an approved employment training scheme or course.
  • Maternity Allowance Benefit – This benefit you can claim when you take time off work to have a baby. You’re able to get it if you’re self-employed, have recently stopped working, you take part in unpaid work for the business of your spouse or civil partner, or if you’re employed but can’t get Statutory Maternity Pay. You’re able to get Maternity Allowance for up to 39 weeks and you can claim as soon as you’ve been pregnant for 26 weeks.
  • Pension Credit – You can claim Pension Credit to help with your living costs, such as ground rent or service charges, if you’re over the State Pension age and on a low income. Pension Credit is separate from your State Pension, as you can still get Pension Credit if you have other income, savings or own your own home.
  • Personal Independence Payment (PIP) – PIP can help you with the extra living costs if you have both a long term physical or mental health condition or disability and difficulty doing certain everyday tasks.
  • Severe Disablement Allowance – Severe Disablement Allowance has been replaced by ESA, which we explained just further up the list, and Jobcentre Plus will re-assess your Severe Disablement Allowance claim to see if you’re capable to work or you’re eligible for ESA.
  • Universal Credit – Universal Credit is a payment to help with your living costs and it’s paid monthly, or twice-monthly if you’re in Scotland. You may be eligible for this benefit if you’re on a low income, out of work or you’re unable to work. To claim this benefit, you must live in the UK, be aged 18 or over, be under the State Pension age and have £16,000 or less in money, savings and investments.
  • Widow’s Pension Benefit – This benefit is now called Bereavement Support Payment, which we have explained for you near the top of this bullet point list. It’s a benefit you can claim if your husband, wife or civil partner has died in the last 21 months.
  • Working Tax Credit Benefit – You can only claim for Working Tax Credit if you’re already getting Child Tax Credit. If you’re unable to apply for this benefit, you can apply for Universal Credit instead. It’s important to know some self-employed people aren’t eligible for Working Tax Credit.

This is not a complete list and so we recommend checking with a mortgage advisor to be sure that you’re able to buy your council house with your benefit. Also, some councils will have different stances on which benefits can be used to buy a house, so your mortgage advisor will be able to help you out.

There is one catch when it comes to buying your council house whilst on benefits and that is that you will no longer be able to claim housing benefits, especially not if you would be claiming them to cover the mortgage costs.

Do I need a deposit to buy my council house?

If you use the Right to Buy scheme (which we will cover in more detail a little later on), most mortgage lenders will allow you to have a mortgage without the need for an initial deposit.

As the Right to Buy scheme was introduced to help council tenants and housing association tenants have the ability to purchase the property they live in, at a BIG discount, mortgage lenders take this into account when it comes to you applying for a mortgage, allowing you to get one without the need for the deposit.

Can I get a mortgage when on benefits?

If benefits are your only or main source of income, then you will be able to get a mortgage. When applying for a mortgage, your lender’s main concern will be the amount and stability of your income, with many happy to accept government benefits as a source of income.

If you’re on benefits to supplement a low income, then this is different to getting a mortgage with benefits being your only source of income.

You will need to ensure the mortgage lender you wish to use will accept your benefit as a form of income, as some will only consider them if you’re also employed or retired, with some mortgage lenders not wanting to consider them at all.

The best way to ensure you will be able to get a mortgage with your benefit is to go to a mortgage advisor, as they will be up to date on which lenders will allow you to get a mortgage with benefits, which makes the whole process a lot smoother for you.

One thing to keep in mind if benefits are your main or only source of income is that you may be able to get housing cost payments alongside a mortgage to help you cover the interest on your mortgage. You’re only able to get housing cost payments if you’re eligible for universal credit.

If you do apply for housing cost payments, the amount you will receive will be decided by the department of work and pensions and you may face a situation where you don’t get the full amount you apply for.

For example, if you have chosen a home the department feel is too big for you, or overpriced, or in an area that isn’t affordable, then it’s likely you won’t be given the full amount.

However, an exception to this is if you explain why you need the full payment and why you’ve selected the property, then you may be able to get the department to change their mind.

How can I apply for housing cost payments?

To apply, you will need:

  • Details about your income
  • Proof of income
  • Details about your expenses
  • Details of your mortgage
  • Any other relevant financial information

You can only get housing cost payments on mortgages and housing loans up to £200,000. You will need to contact the benefits enquiry team to get an application form to be able to apply.

Government schemes you can use to buy your council house with while on benefit

When it comes to buying your council house while on benefits, there are various different government schemes that are available to you to make buying a house more affordable. The government schemes which you’re able to make use of when buying your council house on benefit are:

  • Lifetime ISA – allows you to save a maximum of £4,000 a year with the government adding a bonus of 25% of your savings each year, up to £1,000
  • Help to Buy ISA – allows first-time buyers to make savings towards a deposit on their first home, with the government giving you a maximum of £3,000 on savings up to £12,000
  • Shared Ownership – you can buy between 25 to 75% of the property initially and can ‘staircase’ to eventually own more, or all, of the property
  • Help to Buy equity loan – the government will lend you between 15 and 40% of the property price, allowing you to put down a 5% deposit and get a mortgage to cover the rest
  • Armed forces help to buy – this is essentially the same as Help to Buy but is specifically for people from the armed forces
  • Right to Buy – we will get to this one in more detail, but it essentially allows you to buy your house at a discounted price
  • Preserved Right to Buy – same as Right to Buy
  • Right to Acquire – the same as Right to Buy but for housing associations
  • Rent to Buy – you agree to lease out the property for a certain time period, with the option to buy the property before the tenancy is over

Right to Buy

We told you we’d come back to this! The reason we’re coming back to this is because it’s the main scheme that people use when it comes to buying their council house AND it’s one of the reasons the waiting list for a council house is ever-growing.

Right to Buy allows council tenants to buy their council house at a discount. You can only apply to buy your council house if:

  • It’s your main or only home
  • It’s self-contained
  • You’re a secure tenant
  • You’ve had a public sector landlord for 5 years – whether that’s a council, an NHS trust or a housing association

We know 5 years sounds like a long time, but it’s important to remember it doesn’t need to be 5 years in a row, it can be 5 lots of 1-year periods at different times.

The Right to Buy scheme allows tenants to buy their council house at discounts of £84,600, or £112,800 if you live in London boroughs. Wanting to know more about the exact level of discount you can get?

That leads us perfectly onto…

How much discount do you get on a council house?

As we have just mentioned, you can discount on the market value of the property when you buy it if you qualify for Right to Buy. The maximum discount in England is £84,600, except for London boroughs where it is £112,800. These numbers will increase in April in line with the CPI (consumer price index).

How much discount you will get is based on the following:

  • How long you’ve been a tenant with a public sector landlord
  • The type of property you’re buying – a flat or house
  • The value of your home

If you sell your home within 5 years, you will likely need to repay some or all of the discount. If you’re buying a property with someone else, you count the years of whoever’s been a public sector tenant the longest.

To get a better idea of the discount you may be eligible for, you can use a Right to Buy calculator.

The amount of discount you get will differ depending on whether you live in a house or a flat.


You get a 35% discount if you’ve been a public sector tenant for between 3 and 5 years. After 5 years, the discount goes up by 1% for every extra year you’ve been a public sector tenant, with a maximum of 70%, or £84,600 across England and £112,800 in London boroughs, depending on which is lower.


You can get a 50% discount if you’ve been a public sector tenant for between 3 and 5 years. After 5 years, the discount goes up by 2% each year for every extra year you’ve been a public sector tenant, up to a maximum of 70% or £84,600 across England and £112,800 in London boroughs, again depending on which is lower.

Well, that’s everything you need to know about buying a council house, including the answer to the all-important ‘can I buy my council house while on benefit?’ Got some insight to give or a question to ask? Or maybe you want to have a go at writing an article like this yourself? Whatever it is, don’t hesitate to get in touch!

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Millie is a perfectionist with a passion for property and writing articles. You’ll find her researching the latest housing trends and the newest up and coming areas worth investing in.

About Millie Archer 115 Articles
Millie is a perfectionist with a passion for property and writing articles. You'll find her researching the latest housing trends and the newest up and coming areas worth investing in.

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