Hi, I was on the other end of that predicament a few years ago. We were buying an ex council house off someone who had bought it under a tenant purchase scheme.
ABSOLUTE NIGHTMARE.
Basically we had to render ourswelves homeless beofre they would let us buy the house. We had to sell out other house, which was the plan anyway. Move out, move into temporary accomodation. Show the Council a contract of sale of the old house and then they issued consent to sale of the ex council house.
Because we werent FTB they seen us as potential investors and wouldnt let us buy the house until we had no where to live.
OP if you do get a buyer for your house alternative accomodation isnt enough. The buyer of your house must be FTB's or not have any other property. I have head that this varies from COuncil to COuncil, so check it out.
Good luck