The Rent to Buy Scheme in the UK Explained
By Lauren Prescott, removals specialist with 15 years of industry experience · Updated January 2025
Rent to Buy lets eligible tenants rent a new build home at a discount to market rent for a fixed period, typically between two and five years, with the intention that the saving helps build a deposit to buy the same property later, usually through shared ownership.
The short answer
- Rent is typically set at around 80 per cent of market rent during the scheme period.
- The scheme is generally aimed at first time buyers or those returning to the market who are in stable employment.
- You usually buy at the property's value when you purchase, not the value when you moved in.
- Rent to Buy suits people who will reliably save the discount rather than let it absorb into living costs.
- Scheme availability and exact terms vary by housing association and region, so check current details directly.
How Rent to Buy works
Under Rent to Buy, you rent a new build property from a housing association at around 80 per cent of the full market rent, for a fixed period that commonly runs between two and five years depending on the scheme. The intention is that the gap between the discounted rent and full market rent is saved over that period, building towards a deposit for buying the same property, typically through a shared ownership purchase at the end of the term.
Who qualifies
Rent to Buy is generally aimed at first time buyers or people returning to the property market after not owning for some time, and most schemes require applicants to be in employment with an income sufficient to sustain the rent reliably throughout the period. Household income caps and other eligibility criteria are commonly applied and vary between housing associations and regions, so it is worth checking the specific scheme's requirements rather than assuming they match another provider.
What the rent actually covers
The discounted rent under Rent to Buy works in a similar way to a standard assured shorthold tenancy in terms of your rights and responsibilities as a tenant, though the fixed term and the intention to eventually purchase set it apart from an open ended private rental. It is worth reading the tenancy agreement carefully to understand what happens if your circumstances change during the rental period, including whether you can leave early.
Buying at the end of the term
When the rental period ends, you generally have the option to buy the property, usually through shared ownership, purchasing an initial share and paying rent on the remainder, with the option to buy further shares over time through a process known as staircasing. The purchase price is based on the property's value at the point you buy, not its value when you first moved in, which means in a rising market the eventual cost can be higher than it might have appeared at the start of the scheme.
Comparing Rent to Buy with other routes
It helps to weigh Rent to Buy against the alternative of simply renting privately and saving independently, since the two routes suit different circumstances.
| Factor | Rent to Buy | Private renting and independent saving |
|---|---|---|
| Monthly rent | Discounted, around 80 per cent of market rent | Full market rent |
| Flexibility | Tied to a fixed scheme term and specific property | Can move more freely between tenancies |
| Deposit building | Built in through the rent discount, if saved | Depends entirely on personal saving discipline |
| Purchase price certainty | Based on value at time of purchase, not at move in | Not applicable unless buying separately |
Weighing it up
Rent to Buy suits people who can reliably save the gap between the discounted and full market rent each month, since the scheme only delivers its intended benefit if that saving genuinely happens rather than being absorbed into everyday living costs. If saving discipline is the main challenge rather than the headline rent level, a standard tenancy paired with a dedicated savings plan, potentially including a Lifetime ISA for the government bonus on a first home deposit, can be more flexible and achieve a similar outcome.
As with other government backed housing schemes, eligibility rules, discount levels and regional availability change over time, so it is worth checking the current position directly with participating housing associations or on gov.uk before applying, rather than relying on older figures.
Frequently asked questions
How much discount does Rent to Buy offer on rent?
Typically around 20 per cent below full market rent, so rent is set at roughly 80 per cent of the market rate, though this can vary slightly between schemes.
How long does the Rent to Buy period usually last?
Commonly between two and five years, depending on the specific scheme and housing association, after which you generally have the option to purchase.
Do I buy the property at its original value or its current value?
At its value at the time you purchase, not the value when you first moved in, which matters if local property prices have risen during the rental period.
Who is eligible for Rent to Buy?
Generally first time buyers or those returning to the property market, in stable employment with sufficient income to sustain the rent, though exact criteria vary by scheme and region.
Is Rent to Buy better than just renting and saving separately?
It depends on your saving discipline. Rent to Buy builds the discount in automatically, but a standard tenancy with a dedicated savings plan can be more flexible if you can save reliably on your own.
Planning a move?
BlueSky Removals gives fixed written prices after a free video or home survey. Call 0800 090 3125 or request a quote online.