Guidance

The Grenfell Assisted Home Ownership Scheme

Published 20 November 2023

Applies to England

Introduction

The Grenfell Assisted Home Ownership Scheme (GAHOS) is a government-led scheme that has been designed by the Department for Levelling Up, Housing and Communities (DLUHC). 

GAHOS has been developed to fulfil former Prime Minister Theresa May’s commitment that “everyone whose home was destroyed will be guaranteed a new home on the same terms as the one they lost.” In doing so, it aims to ensure that, as far as possible, former Grenfell residents whose homes were destroyed are no worse off in their ability to purchase their current social homes due to the tragedy. 

Eligibility

GAHOS is open to former residents of Grenfell Tower and Grenfell Walk who had, or would have acquired, the statutory Right to Buy their Grenfell homes. It is not open to former Grenfell residents who have already exercised their statutory Right to Buy or the Royal Borough of Kensington & Chelsea’s (RBKC’s) Enhanced Portable Discount scheme. 

If a resident who is named as a lead tenant at their current social home chooses, they can transfer their eligibility for GAHOS to another family member who lived with them as part of their original Grenfell household, but who has subsequently been rehoused into their own, separate social tenancy.  

Only one GAHOS application is permitted per original Grenfell household. This means that if a resident transfers their eligibility to another family member, they will no longer be eligible for GAHOS themselves.  

How GAHOS works 

GAHOS gives former Grenfell residents the option to purchase a leasehold interest (‘share’) in their current social homes. To exercise GAHOS, residents must purchase a share in their current social homes that is at least equivalent to the market value of their Grenfell homes. These market values are based on what residents’ Grenfell homes were worth on 1 June 2017. In most cases, the remaining share in residents’ current social homes will continue to be owned by their existing landlords.  

If a resident lives in a home that is owned or leased by RBKC, once they have exercised GAHOS, they can choose to have the remaining share transferred to a housing association. The housing association will then become the resident’s landlord. This option is only available to residents who have an existing social tenancy with RBKC. DLUHC will provide grant funding to the housing association to enable them to purchase the remaining share in a resident’s home from RBKC.  

To recreate, as closely as possible, the terms that would have applied had residents purchased their Grenfell homes through the statutory Right to Buy scheme, they are entitled to an equivalent discount on the purchase price of their share in their current social homes. The maximum level of Right to Buy discount for London can be found on Right to Buy discounts. The level of Right to Buy discount changes every year in April in line with inflation.  

To reflect the higher market value of their current social homes, residents can also access an additional level of discount, known as a ‘market premium’. The market premium element of GAHOS is equivalent to 20% of the market value of residents’ Grenfell homes. DLUHC will provide grant funding to landlords to cover the cost of the market premium.  

Once the Right to Buy discount and the market premium have been accounted for, residents must use their own resources (for example, a mortgage and/or savings) to purchase the rest of their share in their home.  

Residents will not be required to pay rent on the share in their home that is still owned by their landlord ensuring that they are no worse off than they would have been had they purchased their Grenfell homes. Their service charges will also be capped at Grenfell rates. This cap does not apply to charges for major works. Landlords will receive grant funding from DLUHC to compensate for any loss of income incurred through these features of GAHOS.   

The lease terms

Once residents purchase a share in their homes, they will become leaseholders. The terms of their lease will spell out their rights and responsibilities regarding their share in their homes (for example, the need to pay service charges), as well as their landlords’ rights and responsibilities regarding their interest in the homes (for example, the need to arrange repairs and maintenance work for communal areas within a wider block or estate).   

As residents are purchasing a share in their homes, the terms of their leases will look similar to the terms of a shared ownership lease. To ensure that GAHOS’s specific features can operate effectively (for example, the cap on rent and service charges), all leases issued through GAHOS must contain a series of fundamental clauses, which are non-negotiable. DLUHC has issued guidance to all landlords to ensure leases contain the relevant fundamental clauses. 

Over time, residents can increase the size of their share in their home through a process known as ‘staircasing’. The type of staircasing used by GAHOS matches the staircasing arrangements for the new model of shared ownership. The option to staircase will be facilitated through the fundamental clauses of residents’ leases.  

Other available homeownership schemes 

In addition to GAHOS, residents also have access to the statutory Right to Buy scheme (or equivalent contractual arrangement if their landlord is not a local authority) and the Enhanced Portable Discount scheme, which has been developed by RBKC. 

Further information on both options can be found on Home ownership schemes for former Grenfell Tower and Walk tenants (PDF, 260 KB).   

It is important to note that these are standalone options and that it is not possible to exercise more than one scheme, or to exercise them in combination.  

Date of application

DLUHC is working to finalise the scheme’s last details and to secure final agreement from all landlords. We hope to open GAHOS to applications from residents in the coming months and will write to all those who are eligible once we have a firm date for launch.