Selling Your House To The Council, Will They Buy It?

Find out everything you need to know about councils buying houses and see if you can sell yours.

The current state of the UK housing market presents a tough situation for those looking to sell an ex-council house back to the council itself. 

With financial difficulties and bankruptcies in the news almost every day, it’s no wonder some council homeowners are struggling to find willing participants in their local authorities — but what does the situation look like now? Is it still possible for you to sell your ex-council house back to them? Are there alternatives if you want a quick sale? 

We’re delving into ex-council houses here to give you the complete rundown of what’s in and out of the question as a homeowner. Find out everything you need to know about selling your council house in 2025.

Table of Contents

• Will the council buy your home back?

• Common reasons for difficulty selling ex-council houses

• How many houses have councils bought back?

• Why do councils need more properties?

• What is the best option for selling your council house?

• How to sell an ex-council house

Will the council buy your home back?

If this were 2015, the answer to this question would almost certainly have been ‘yes’. In 2025, however, councils are in a much tighter spot, which means council house owners are having great difficulties selling their homes back.

Many councils across the UK are struggling with serious financial problems due to overspending and a lack of funding. In fact, some have already declared bankruptcy, and others are close to it. 

The Guardian recently reported that almost half of England’s councils are in serious financial trouble. Moreover, a recent survey by the Local Government Association found that nearly one in five council leaders and chief executives think their council could go bankrupt in the next couple of years. If you live in one of the council areas below, it’s very unlikely that your local council will buy back your home.

Councils that have already declared bankruptcy 

Here are some councils that have officially run out of money and issued what’s called a Section 114 notice:

• Croydon Council: Declared bankrupt in November 2022 for the third time and recently requested a bailout from the government. They’re dealing with a £130 million hole in their budget, mostly caused by years of financial mismanagement.

• Thurrock Council: Went bankrupt in December 2022 after racking up a £500 million deficit from failed solar energy investments. The BBC reported in July 2024 that the council needed to borrow over £200m from the government to balance its budget.

• Woking Council: Issued a Section 114 notice in June 2023, with a shocking £1.2 billion deficit caused by risky investments in hotels and skyscrapers. Now former figures are under investigation, according to a report from The Guardian in February 2025.

• Birmingham City Council: Declared bankruptcy in September 2023 and still struggling in October 2024, with the BBC branding it a “beleaguered” council. They owe over £750 million in equal pay claims and have been hit hard by problems with a new IT system.

Councils at risk of bankruptcy 

Some councils haven’t gone bankrupt yet, but they’re not far off. Here are a few that are in serious financial trouble:

• Hampshire County Council: Looking at a £175 million shortfall in 2025/26—the biggest gap in the country—and expect bankruptcy in 2026. They’ve already had to cut services like libraries and street lighting.

• Surrey Heath Council: Warned in late 2023 that they could go bankrupt within two years due to £165 million of debt from failed property investments. Faced a “catastrophic” shortfall of £4 million in September 2024.

• Havering Council: In September 2023, they admitted they might go bankrupt within six months because of rising costs in housing and social care. Luckily, they secured £54 million in government support in February 2024, which should help them through.

• Cheshire East Council: Hit hard by the cancellation of HS2’s northern route, leaving them £11 million out of pocket for preparatory work. As of November 2024, it was anticipating a lesser shortfall last financial year than previously thought, but Labour’s Ken Edwards was described as being “very, very gloomy” about its prospects.

• Bournemouth, Christchurch and Poole Council: Facing a £65 million deficit in their education budget, mostly because of overspending on support for children with disabilities. The council will be technically insolvent from March 31st, 2026.

Fife Council is one example of an authority that’s actively involved in the ‘buy back’ of council houses to try to decrease homelessness in the area. Its councillors are calling for Labour to do more to fund the purchases of ex-council houses, which they say can be achieved “four times quicker than a new-build and at half the price.”

Labour housing spokesperson, Cllr Judy Hamilton, is adamant the government’s funds “will mean 700 more new homes, including 336 new council houses” for the Fife area, but former SNP leader, Cllr David Alexander, thinks the property acquisition programme needs to go much further: “Other Labour councils do more on acquisitions. Is there some sort of dogma in place that’s stopping you doing the blindingly obvious thing to do?”

The above paints a pretty bleak picture of the prospects of UK councils in 2025 and beyond, so the requests of council house owners to sell their homes back to their local authorities will more than likely be falling short. The Property Buying Company’s CEO, Karl McArdle, has seen the seriousness of this struggle intensify over the years:

Common reasons for difficulty selling ex-council houses

Selling an ex-council house on the open market can be tricky, especially because some buyers believe there’s a stigma with such properties. This is particularly true in areas where council housing is linked to socioeconomic challenges, which can make ex-council homes less appealing—especially to those needing a mortgage.

For example, Better, an independent mortgage broker, says that many lenders require larger deposits for ex-council properties. If a lender normally offers a 95% Loan to Value (LTV) ratio for standard homes, they might only offer 90% for ex-council homes, meaning buyers need a bigger upfront deposit. If you’re a council house owner looking to sell, this can seriously narrow your pool of potential buyers.

Here are some of the most common issues surrounding the selling of ex-council homes:

Leasehold issues

Ex-council flats often come with leasehold agreements, which means you own the property itself, but not the land on which it’s built. This can make selling them more complicated, especially when leases are short. Buyers tend to hesitate if a lease is running out because extending it can be expensive and time-consuming.

For example, extending the lease on a flat worth £200,000 could cost around £5,000 if the lease has 85 years remaining. However, once the lease drops to 60 years, the cost can skyrocket to around £38,000. On top of that, you’ll need to pay legal and surveyor fees, which can add another £2,000 to £4,000.

It’s not just the cost of extending a lease that’s a concern. According to The Guardian, some ex-council leaseholders face massive bills for maintenance and repairs. 

Emma Clarke, who lives on the Taverner and Peckett Square estate in Islington, received a maintenance bill as large as the deposit she originally put down for her one-bedroom flat.

Another resident on the same estate was hit with a staggering £61,000 bill for a three-bedroom flat.

These kinds of unexpected costs can scare off potential buyers and make it even harder to sell an ex-council property on the open market. This leaves many ex-council homeowners in a tough place, especially if the council won’t buy it back themselves.

Challenges with securing mortgages

A lot of ex-council homes, particularly those built in the 1960s and 1970s, were made with non-standard materials like concrete or steel frames. These construction methods are often seen as higher risk by lenders, which can make it harder for buyers to get approved for a mortgage.

If the ex-council property is in a high-rise building, it might face some additional hurdles. Some lenders simply won’t approve mortgages for flats in buildings over five storeys tall because they view them as less marketable—many of them have a much lower resale value.

Similarly, cladding on high-rise flats can further complicate things. Many lenders will now require an External Wall System (EWS1) form to confirm the building meets safety standards before they’ll even consider approving a mortgage. This requirement can delay or block sales entirely if the form isn’t available.

Another issue is the length of the lease—most lenders insist on a minimum lease term, usually between 70 and 85 years, to approve a mortgage. If the lease is shorter, it’s seen as a risk because the property’s value drops as the lease runs out, making it less appealing to mortgage buyers and lenders.

Right to Buy restrictions

If you bought your home through the Right to Buy scheme, there are some restrictions to keep in mind if you decide to sell it. For example, selling your home within five years of buying it could mean you’ll need to repay some or all of the discount you received. 

However, how much you pay back depends on how long you’ve owned the property:

• Year one: You’ll need to repay 100% of the discount.

• Year two: 80% of the discount must be repaid.

• Year three: You’ll need to repay 60% of the discount.

• Year four: 40% repayment is required.

• Year five: You’ll repay 20% of the discount.

• After five years, you can sell the property without having to repay any of the discount.

If you sell within the first ten years, you’re required to offer the property to your former landlord (usually the council or housing association) or another social landlord in the area first. This must be done at the full market price, which will be agreed upon between you and the landlord.

These rules are designed to make sure that homes sold under the Right to Buy scheme stay available as affordable housing for a reasonable amount of time, helping to support the wider social housing sector.

The locations and surroundings of council houses

Ex-council homes are often found on estates that are still predominantly council-owned. While these properties can offer great value, some buyers might be put off by concerns about the neighbourhood’s reputation or how it could impact future property values.

On average, properties on council estates sell for around 70% of the price of similar homes in the private sector. For instance, if a privately built three-bedroom house is valued at £250,000, a comparable ex-council flat might sell for around £175,000.

This price difference reflects both the stigma associated with council estates and the practical appeal of ex-council properties, which are often more affordable for first-time buyers or those looking for more space at a lower cost.

The need for renovation

If your ex-council house needs renovating, it could be a deal-breaker for some buyers. In communal areas, such as roofing or plumbing, maintenance costs are usually shared among residents. Unfortunately, these costs can be steep—some residents in council-owned blocks have faced refurbishment bills as high as £40,000.

Older ex-council properties also tend to have lower Energy Performance Certificate ratings, meaning that they are less energy efficient. While the percentage of homes in England rated EPC C or higher has improved from 12% in 2010 to 52% in 2022, many older homes, including ex-council properties, still fall short.

How many houses have councils bought back?

In recent years, some local councils across the UK have stepped up to buy back former council homes to tackle housing shortages and provide more affordable options. When councils are not facing financial pressures or the threat of bankruptcy, they are more likely to invest in repurchasing these properties to address local housing needs.

Since 2015, councils have collectively spent around £1.7 billion to reclaim around 8,600 homes that were previously sold under the Right to Buy scheme. This trend has picked up significantly in recent years, with over 5,900 homes bought and £1 billion of that spent since 2020 alone.

In London, the Mayor’s Right to Buy scheme, introduced in July 2021, has played a massive role. So far, the scheme has helped bring over 1,500 homes back into public ownership, with 14 boroughs receiving £152 million to fund these acquisitions. These homes are now being offered at more affordable rates to help meet the growing demand for housing.

If you own an ex-council house, don’t feel discouraged if the council isn’t able to buy it back directly from you. Thanks to systems established by the Home Office, private companies can rent properties out to the Government to help ease the strain on housing shortages. Many of these properties are acquired through companies like The Property Buying Company.

This means that even if your local council isn’t interested in buying your house, The Property Buying Company likely will be—the service offers a quick and hassle-free alternative, ensuring your property can still be put to good use in addressing housing needs.

Why do councils need more properties?

The Right to Buy scheme, particularly during the 1980s and 1990s, caused a massive decline in council-owned homes. Many of these properties were sold to private buyers, which significantly reduced the amount of social housing available for those in need.

Fast forward to 2024 and 41% of homes bought under the Right to Buy scheme are owned by private landlords, according to the New Economics Foundation (NEF). This shift has resulted in higher rents compared to council housing, pushing councils to buy back these properties and reintroduce them into affordable housing pools.

According to the Resolution Foundation, Angela Rayner, the Deputy Prime Minister, would need to spend £15 billion just to build 125,000 new homes to house all the families currently stuck in temporary housing. And, if they want to go beyond that and actually create a surplus of housing, they’d need 400,000 extra properties at a staggering cost of £50 billion.

It’s no wonder the Labour government criticises the Right to Buy scheme. The homes sold off at big discounts weren’t replaced anywhere near quickly enough, leaving England with a severe shortage of social housing and millions of people struggling to find a stable, affordable place to live.

The graph below shows how property sales surged in the 1980s, leaving a long-term shortage of affordable council housing:

With demand for housing intensifying in cities like Birmingham, Leeds and London, councils are under growing pressure to provide affordable homes for their communities.

Buying back former council homes is often quicker and much more affordable than building new ones. Constructing a standard three-bedroom house, sized between 90 and 120 square metres, can cost anywhere from £126,000 to £300,000. On the other hand, ex-council homes can sometimes be bought back for as little as £50,000, depending on where they’re located.

What is the best option for selling your council house?

We know it’s difficult to make a decision when you need to sell your home, but the good news is that you have plenty of options.

Working with a cash buyer or property investor might work for some, but not for others. They can often offer a quick and straightforward sale without the delays or complications you might find elsewhere, but they can also mean you get less than you hoped for when you consider the full market value of your home.

Here’s how your options compare when it comes to selling your ex-council house:

Some estate agents will help you sell your ex-council house and may even get you close to or more than 100% of its market value. There’s an element of luck involved here, of course, but you might hit on the right place at the right time.

Comparatively, cash buyers might get you more like 80-90% of the value, but will guarantee the sale, no matter the condition or location of the property. They’ll also help turn ex-council homes into affordable housing and contribute to meeting local demand as a result, so there can be pros and cons to every route—choosing the best one for you comes down to your personal circumstances.

How to sell an ex-council house

The simplest and fastest way to sell an ex-council home is by working with a cash house buying company such as The Property Buying Company. We specialise in buying properties outright, whether they’re freehold or leasehold, and no matter their condition, location or size.

Cash buyers like us are ideal for sellers who need to move quickly. With no reliance on mortgage approvals, sales can be completed as quickly as 7 days, although most cash sales take around 3-5 months to complete (still far faster than an estate agent).

Selling to The Property Buying Company

What’s more, properties with issues like structural problems, noisy neighbours, or locations in high-rise buildings can deter mortgage buyers. Cash buyers, however, are often willing to buy the ex-council flats and homes, offering a solution where the open market fails time and again.

The Property Buying Company has built a strong reputation for providing a fast, simple and transparent service. We’ll cover all your legal fees, and the cash offer we make will be the amount you’ll receive—no deductions or last-minute surprises.

For ex-council homeowners who want speed and convenience over achieving the highest possible sale price, a cash buyer can be an excellent choice. If you’re ready to sell your council home, start by entering your postcode below for a free, no-obligation cash offer. You’ll have the flexibility to choose a timeline that suits you.