Guidance

The Grenfell Assisted Home Ownership Scheme: Key information document

Published 24 May 2024

Applies to England

1. Key information about the Grenfell Assisted Home Ownership Scheme

When you buy a leasehold interest (‘share’) in your home through the Grenfell Assisted Home Ownership Scheme (GAHOS), you enter into a lease. The lease is a legal agreement between you (the ‘leaseholder’) and the landlord. It sets out the rights and responsibilities for both parties.

Before committing to buy a share in your home through GAHOS, you are encouraged to take independent financial and legal advice.

This document is to help you decide if GAHOS is right for you. You should read it carefully so that you understand what you are buying, and then keep it safe for future reference.

It does not form part of the lease. You will receive a copy of the lease later in the application process. Once you have received the lease, you must carefully read and consider the information and discuss it with your solicitor before signing. 

Once you have purchased your share, failure to pay your service charge or mortgage could mean your home is at risk of repossession.

These costs could increase, and you should take financial advice on whether this will be sustainable for you in the long term.

Your service charge will likely increase on an annual basis. The cost of your mortgage payments will either increase or decrease at the end of your mortgage term, depending on any new deal that you secure from your mortgage lender.

2. How the Grenfell Assisted Home Ownership Scheme works

GAHOS has been designed to reflect, as closely as possible, the conditions that would have applied had you purchased your Grenfell home using the statutory Right to Buy scheme.

The Department for Levelling Up, Housing and Communities (DLUHC) is aware that your current home is likely more expensive than your Grenfell home, meaning that it may be more difficult for you to use your Right to Buy to purchase it outright.

To overcome this problem, GAHOS enables you to purchase a share in your home that is at least equivalent to the full value of your Grenfell home, as it was on 1 June 2017. This is referred to as the ‘minimum’ share.

The value of your Grenfell home has been determined by a valuations report from the District Valuer Services, commissioned by DLUHC. Your landlord has a copy of this report, and you can ask to see it if you would like.

The values for the different sizes of Grenfell homes are set out in the tables below.

Grenfell Tower:

Size of home	Value
One bedroom	£275,000
Two bedrooms	£355,000
Three bedrooms	£400,000

Grenfell Walk:

Size of home	Value
Studio	£275,000
One bedroom	£315,000
Two bedrooms	£460,000
Three bedrooms	£495,000
Five bedrooms	£580,000

If, for example, you lived in a two-bedroom flat in Grenfell Tower, to use GAHOS, you must buy a share in your home worth at least £355,000.

If you would like to, you can explore the possibility of purchasing a larger share too. This includes a share worth 100% of the full value of your home.

The financial assistance that is available to you to help with the purchase of your share in your current home

To help you to purchase a share in your home through GAHOS, you will receive a certain amount of financial assistance. This assistance is broken down into 2 parts:

• 1.    An amount that is the same as the discount you would have received had you used your statutory Right to Buy your Grenfell home. Further information on the size of the statutory Right to Buy discount for London can be found at: https://www.gov.uk/right-to-buy-buying-your-council-home/discounts.

• 2. A ‘market premium’ worth 20% of the value of your Grenfell home.

Examples of how this financial assistance will work in practice are set out in the tables below. These examples are based on the value of the maximum statutory Right to Buy discount for London in 2024/25 of £136,400.

The statutory Right to Buy discount currently increases each year in line with inflation. It may also be subject to future changes in policy. You can monitor the size of the statutory Right to Buy discount using the above link.

Please note: The amount in Column E of each table shows the total amount of financial assistance you will receive (i.e. the Right to Buy discount + the 20% market premium).

The amount in Column G of each table shows how much you will need to fund from your own resources (e.g. via savings and/or a mortgage) to purchase the minimum share in your home once this financial assistance is applied to the purchase price of your share.

For applicants who lived in Grenfell Tower:

A	B	C	D	E	F	G
Size of Grenfell home	Value of Grenfell home	Max. London Right to Buy discount for London (in 24/25)	Value of the market premium (20% of B)	Total amount of financial assistance (C + D)	Value of the minimum share required for purchase	Purchase price of the minimum share once the financial assistance is applied (F – E)
One bedroom	£275,000	£136,400	£55,000	£191,400	£275,000	£83,600
Two bedrooms	£355,000	£136,400	£71,000	£207,400	£355,000	£147,600
Three bedrooms	£400,000	£136,400	£80,000	£216,400	£400,000	£183,600

For applicants who lived in Grenfell Walk:

A	B	C	D	E	F	G
Size of Grenfell home	Value of Grenfell home	Max. London Right to Buy discount for London (in 24/25)	Value of the market premium (20% of B)	Total amount of financial assistance (C + D)	Value of the minimum share required for purchase	Purchase price of the minimum share once the financial assistance is applied (F – E)
Studio	£275,000	£136,400	£55,000	£191,400	£275,000	£83,600
One bedroom	£315,000	£136,400	£63,000	£199,400	£315,000	£115,600
Two bedrooms	£460,000	£136,400	£92,000	£228,400	£460,000	£231,600
Three bedrooms	£495,000	£136,400	£99,000	£235,400	£495,000	£259,600
Five bedrooms	£580,000	£136,400	£116,000	£252,400	£580,000	£327,600

Increasing the size of your share in your home over time through ‘staircasing’

You can increase the size of your share in your home through a process known as staircasing. For more information on staircasing, please see Section 7 below.

Subletting

Once you have purchased your share, you can sublet the whole of your home to someone else. You can also rent out a room to a lodger while you are still living there. You can keep 100% of any income generated through subletting or renting a room to a lodger. You do not need to split it with your landlord. 

If you decide to sublet the whole of your home or rent out a room to a lodger, you must let your landlord know. If you are subletting, you must provide your landlord with your new contact details, as well as contact details for your tenant(s).  

If your landlord is not the freeholder (i.e. the owner) of your building, you may also need to secure the freeholder’s permission before subletting. If you have a mortgage, you must secure your mortgage lender’s permission before subletting.

Before subletting the whole of your home to someone else, or renting a room to a lodger, it is recommended that you receive independent financial advice. This is because the rent you receive may have tax implications.

Alterations

Before making any significant alterations to the interior or exterior of your home, you must notify your landlord and, in some cases, seek their permission to carry out the work. The terms of your lease will set this out in more detail, but you will usually need permission for anything that alters the structure of the home (e.g. the removal of an internal wall).

3. Details about your lease

The share in your home that you purchase through GAHOS will be sold to you on a leasehold basis. This is because your landlord will retain a legal and financial interest in the remaining share of your home that you do not purchase.

Your landlord will tell you the length of the lease you may purchase. All lease terms will be offered for a minimum of 99 years. Your landlord is expected to offer you the maximum possible lease term, including for 990 years where they own the freehold to your building.

If your landlord does not own the freehold to your building, this can limit the length of the lease that they can provide you with.

Your lease will contain a range of important information, including:

• a description of your home, including its boundaries
• your responsibilities as a leaseholder, such as repairs and maintenance, and your landlord’s responsibilities, such as buildings insurance
• details of any restrictions or obligations, such as major structural works
• the lease start date
• the size and value of the share in your home that you have purchased
• the services that your landlord may charge you for (e.g. for the repair and maintenance of communal areas)
• the method by which you can increase the size of your share in your home through staircasing
• the method by which you can move home, either by selling your share back to your landlord, or by selling the whole home on the open market

As the lease is a legally binding contract, review it carefully with your solicitor and ask for their advice. It is important that you make sure that you understand the lease before you sign it. Your solicitor will provide you with a copy of the lease. A sample version of the lease for GAHOS will be available on Gov.uk once the scheme opens for applications.

The only exception to this is if you live in a house and you purchase a 100% share in it through GAHOS. In this case, you will usually purchase the freehold interest in the house.

Lease extensions

You should speak to your landlord before you purchase your share in your home through GAHOS to confirm their lease extension policy and what rules they have if you want to extend the lease term.

There will be costs associated with a lease extension that you need to be aware of. The length of your lease can affect the value of your home. Usually you can extend your lease, but this can be expensive.

You may need to extend the term of your lease as a short lease can make it more difficult to sell. A short lease is generally considered as one with 80 years or less left on the term, although different mortgage lenders have different criteria. It can be significantly more expensive to extend a short lease.

Before you purchase your share in your home through GAHOS, you must ask your solicitor about your lease and the implications it has for you now and in the future. Your solicitor is responsible for providing you with legal advice.

Your landlord may not own the freehold to the building which may limit the lease extension length they can provide you with.

The main costs to consider when extending your lease are:

• The ‘premium’: This is the amount of money charged for increasing the lease length. Where the landlord is not the freeholder, they may need to pay a premium to the freeholder in order to extend their own lease.

• Valuation costs: In order to find out the premium, a specialist valuation will need to be carried out.

• Legal costs: You and your landlord will need to take legal advice. Your landlord may require you to pay their legal costs in addition to your own.

The Leasehold Advisory Service

Following your purchase of your share in your home, you can receive free and independent initial advice on the terms of your lease from the Leasehold Advisory Service.

The Leasehold Advisory Service can be contacted by phone on 020 7832 2500, or through their website: https://clients.lease-advice.org 

Please note: Any advice received from the Leasehold Advisory Service should not be considered a substitute for legal advice that you might pay a solicitor for.

100% ownership

Over time, you can increase the size of your share in your home through staircasing. Further information on staircasing can be found in Section 7 below.

If you reach 100% ownership of a house through staircasing, in most cases, the freehold will transfer to you and your lease will no longer apply. If you reach 100% ownership of a flat through staircasing, your lease will normally continue but certain parts of it will no longer apply. In the case of a flat, your lease will set out which clauses no longer apply.

For example, you will no longer need to offer your landlord the option to repurchase your lease before selling your home on the open market. It will still be helpful to let your landlord know that you intend to sell your home, as this will enable them to provide you with certain information that might be needed by the buyer (e.g. details about the service charge).

Your landlord will not charge you for the transfer of the freehold, but there may be other charges associated with reaching 100% ownership of your house or flat. For example, you may need to pay Land Registry fees to register the change in ownership or notice fees to third parties, such as estate management companies.

Your solicitor should tell you if any of the above will apply to your home.

Passing your lease on to someone else

You can pass your lease on to anyone at any time. It is, however, important to note that GAHOS’s special features, including the cap on rent and service charges, can only be passed on to certain people.

These people are named in your lease and include your spouse or civil partner, other family members who live with you at the home, and your children.

If your spouse or civil partner inherits the lease, then GAHOS’s special features will remain in place for as long as they hold it. If other family members who live with you at the home or your children inherit the lease, then GAHOS’s special features will remain in place for 10 years from the date that they inherit the lease.

This 10-year period has been set because GAHOS’s special features have implications for inheritance tax and allowing them to continue indefinitely could result in a significant amount of tax being owed once the lease is inherited by someone other than your spouse or civil partner.  

You are advised to speak with your solicitor about who can inherit the lease, when, and for how long GAHOS’s special features will last once the lease has been passed on. You are also advised to seek independent financial advice on the inheritance tax implications of passing on the lease to someone other than your spouse or civil partner.  

4. Other costs involved in purchasing your share

Deposit

You’ll need to pay a deposit towards the purchase of your share in your home. You must check with your solicitor when you need to pay this deposit.

Contents insurance

You will also need to pay for contents insurance. You’ll need to arrange this yourself before you complete the purchase of your share in your home.

Buildings insurance

Your landlord is responsible for buildings insurance. This applies to both houses and flats.

If you reach 100% ownership of your home and remain a leaseholder, you will continue to pay the landlord for buildings insurance.

If you reach 100% ownership of a house and become the freeholder, you will need to arrange buildings insurance yourself.

Mortgage payment

If you are using a mortgage to help pay for the purchase of your share in your home, you should check with your mortgage broker and/or your mortgage lender when your first mortgage payment is due.

Any ongoing mortgage payments will likely be due on the same date every month.

Legal fees and other associated purchase costs

You will need to pay your own legal fees and any associated purchase costs. You can expect to pay fees including:

• legal services fee (i.e. the costs of hiring your solicitor/legal adviser)
• search costs
• banking charges
• Stamp Duty Land Tax (‘Stamp Duty’)
• Land Registry fee
• document fee pack

Legal service fees can vary. Your solicitor must confirm what their fees cover and the cost when you instruct them to act on your behalf.

Remember to plan for these amounts when you work out how much money you need to complete the purchase of your share in your home.

You will receive the following documents from your solicitor:

• an initial quote for the costs involved
• a completion statement after exchange of contracts, which describes the actual costs

Stamp Duty

You may have to pay Stamp Duty depending on your circumstances and the value of the share in your home that you are purchasing.

GAHOS uses a Stamp Duty cap to ensure that the amount of Stamp Duty you must pay when purchasing your share in your home is set at the amount you would have paid had you purchased your Grenfell home.

If, for example, you would have paid £1,000 in Stamp Duty when purchasing your Grenfell home, then the amount of Stamp Duty you must pay to purchase your share in your home will be capped at £1,000.

The difference between the Stamp Duty you would have paid at Grenfell and the full Stamp Duty due on the purchase of your share in your home will instead be met by DLUHC.   

Your solicitor will receive this amount from your landlord prior to the completion of your purchase of your share. Your solicitor will then pay any Stamp Duty due on the value of your share to HM Revenue & Customs (HMRC), including any contribution you may be required to make.

Your solicitor can advise you on whether you are required to contribute to any Stamp Duty due on the purchase of your share. 

If you increase the size of your share in your home through staircasing at a later date, you may have to pay an additional amount of Stamp Duty.

This will only usually occur if your share reaches 80% or more of your home’s full value. You must pay for this additional amount of Stamp Duty from your own resources.

Find further information about Stamp Duty on Gov.uk.

5. The ongoing costs of leasehold homeownership

Once you have purchased your share in your home, you do not need to pay rent on the share that your landlord continues to own.

If you use a mortgage to help with the purchase of your share in your home, you will need to make regular (usually monthly) repayments to the mortgage lender. You should discuss these payments with a mortgage adviser before agreeing to take out your mortgage.

You may also need to make regular (usually monthly) payments to the landlord for the:

• service charge (where applicable)
• buildings insurance
• sinking fund (also known as a ‘reserve fund’) (where applicable)
• management fee (where applicable)

Find further information about service charges and other expenses on Gov.uk.

You can ask your landlord to provide a summary showing how the service charge is worked out and what it is spent on.

If you must pay a service charge, it will be capped at the rate you would have paid as a leaseholder at Grenfell. This cap does not apply to contributions for major works. These contributions will usually be paid into your sinking fund (for further information, see Section 6 below), but they can sometimes be charged as one-off costs.  

You will also need to budget for other regular costs, that may include:

• contents insurance
• Council Tax (as someone who lived in Grenfell, the current cap on your Council Tax payments will continue to apply)
• gas and electricity
• water

6. Maintaining and living in your home

As the leaseholder, you are responsible for keeping your home in good condition. You are also responsible for the cost of repairs and maintenance of the home. This means you will pay 100% of the costs and arrange for any repairs and maintenance yourself.

The landlord is not responsible for carrying out refurbishment or decorations. For example, replacing kitchens or bathrooms.

If you have a boiler in your house or flat, you are responsible for arranging and paying for a boiler service every year. The service must be carried by an engineer on the Gas Safe Register.

Decoration and refurbishment

You can paint, decorate, or refurbish your home as you wish. If you want to make home improvements, you must let your landlord know. Home improvements may increase or decrease the value of your home.  

Responsibilities for maintaining the building

If you live in a house, you may be responsible for maintaining the exterior of your home. This means you will be responsible for arranging and paying for any maintenance and repairs to things like the exterior walls, roof, and guttering.

You should discuss whether you are responsible for maintaining the exterior of your home with your solicitor before signing your lease.     

If you live in a flat, your landlord will usually be responsible for maintaining the exterior of your building, as well as any common areas that you share with other flats (e.g. landings and corridors).

Once your landlord has arranged for any maintenance and repairs, they will recover the costs of this work from you (and the other residents in your building) through your service charge.

You have the right to be consulted about charges for running or maintaining the building if you have to pay more than:

• £250 for planned work; or
• £100 per year for work and services lasting more than 12 months.

There are steps your landlord must follow when they consult you, known as a ‘Section 20’ consultation. 

If your home is a new build, the building warranty will cover the cost of structural repairs (typically for the first 10 years). You should check with your landlord if the building warranty still applies at your home and if so, who the building warranty provider is.

Sinking fund

If you live in a flat, there may be a sinking fund (also known as a reserve fund). If there is a sinking fund, you will need to pay into the fund. The fund covers major works, like replacing the roof.

There are rules about how landlords must manage these funds. You will not usually be able to get back from the landlord any money you pay into this fund if you move home, even if there have been no eligible works carried out while you lived in your home.

Your landlord can provide you with further information on how they have calculated your sinking fund payment and what it will cover.

7. Staircasing

You can increase the size of your share in your home through staircasing. You do not have staircase if you do not want to.

The method of staircasing used by GAHOS matches the method of staircasing used for the new model of shared ownership

When staircasing you can buy 2 different types of shares. These different types are outlined in more detail below.

The only time different arrangements apply is when you complete final staircasing. This means when you staircase to reach 100% ownership of your home. When engaging in final staircasing, you can purchase a share of any size.

Buying a share of 5% or more

You can increase the size of your share in your home by 5% or more at any time.

The cost of the share you are purchasing will depend on how much your home is worth when you want to buy the share.

To find out how much your home is worth, you will need to pay for a valuation by a surveyor who is registered with the Royal Institution of Chartered Surveyors (RICS). You can find a registered surveyor on the RICS website.

Your landlord will let you know whether they will arrange the valuation, or if you will need to arrange it yourself. Your landlord will tell you the price of the share after the valuation.

If you decide to purchase the share, you must buy it within three months of the valuation date. If you do not complete your purchase within this timeframe, your home may need to be revalued.   

Your landlord may charge an administration fee each time you a buy a share of 5% or more. You should ask your landlord about their staircasing policy, and any costs involved.

Valuations and home improvements

If you have made home improvements that affect the value of your home, the valuation must show 2 amounts:

• the current market value – this is the home’s value including any increase because of home improvements; and
• the unimproved value – this is the home’s value ignoring any home improvements carried out.

If you have your landlord’s permission to carry out the home improvements, the price of the share is based on the unimproved value.

If you did not get your landlord’s permission to carry out the home improvements, the price of share is based on the current market value. This price is likely to be higher.

An example

If the current market value of your home is £500,000, a 5% share costs £25,000.

If the unimproved value of your home is £480,000, a 5% share costs £24,000.  

Buying a 1% share

You can also purchase an additional 1% share each year for at least the first 15 years of your lease. This process has been designed to help facilitate cash purchases. You cannot buy shares of 2%, 3%, or 4%.

The price of a 1% share is based on the original price of your home, increased or decreased in line with the House Price Index data

Your landlord will give you a House Price Index valuation whenever you ask to buy a 1% share.

As the price of a 1% share will be based on House Price Index data, you will not have to pay for your home to be valued by a registered surveyor.

Your landlord can choose to have your home valued by registered surveyor instead, but they will have to pay to have this valuation carried out.  

Your landlord will also not charge you an administration fee when you purchase a 1% share.

8. Selling your home

You can sell your home at any time.

If you do not own 100% of your home, you must inform your landlord when you intend to sell.

If you own 100% of your home, you can sell it on the open market. For example, through an estate agent. In some circumstances, you may need to inform third parties about your intention to sell. Your solicitor will tell you if this is the case.

Your landlord’s right of ‘pre-emption’

If you do not own 100% of your home, your landlord can exercise something known as a right of pre-emption. This allows them a short period of time (4 weeks) in which they can offer to buy back your share in your home.

If the landlord chooses to buy back your share in your home, the price will be at the share’s current value based on a valuation by a registered surveyor.

Selling your home on the open market

If your landlord chooses not to buy back your share, you can sell it yourself on the open market. For example, through an estate agent.

To sell on the open market, you must sell 100% of your home. To do this, you will purchase the remaining share from your landlord and then immediately sell 100% of the home to your buyer.

These two transactions happen simultaneously so the money for the remaining staircasing purchase comes from your buyer. This means that you will not need raise the money yourself to purchase the remaining share from your landlord before 100% of your home is sold to your buyer.  

This process is known as ‘back-to-back’ staircasing. Your landlord can provide you with further information on how it will work in practice.

Selling fees and costs

You may have to pay a fee if you use an estate agent to sell your home. This fee can usually be negotiated.

You are responsible for seeking legal advice when you sell your home. You will need to pay your legal fees.

If you own less than 100% of your home and the landlord chooses to buy back your share, you will need to pay to have the home valued, like you would need to if you were to sell your home on the open market.

9. Useful links

• Service charges and other expenses (Gov.uk)

• Service charges and other issues (Leasehold Advisory Service)

• A guide to mortgage fees and costs (Money Advice Service)

• UK House Price Index (Land Registry)

• RICS (Royal Institution of Chartered Surveyors)