and promotes the interests of crofting in Scotland
to secure the future of crofting.
Highland Self Build Loan Fund
28/06/2016
Introducing a brand new fund for self builders in the Highlands!
The Scottish Government’s ‘Highland Self Build Loan Fund’, is to be administered by The Highlands Small Communities Housing Trust, who are now accepting applications.
It has been recognised that there was a gap in the lending market, to provide funding for self builders, prior to mortgage facilities being available. This is where the Highland Self Build Loan Fund aims to help - providing up to £150,000 to self builders struggling to access financial assistance. The fund is designed to help applicants reach build completion, and therefore access a traditional mortgage – which can then be used to repay the loan.
The £4 million fund, will revolve over the next two years, and will hopefully result in numerous self and custom build projects across the region.
BACKGROUND
The Highlands were chosen by the Scottish Government for this two year pilot scheme, after it was noted that the area has a long history of self and custom builds. Keeping the allocation of the fund specifically to the Highland region will assist with monitoring and evaluation of the Highland Self Build Loan Fund, and give an indication to the Scottish Government of how successful the pilot is.
Over recent years, it has become increasingly obvious that there is a gap in the market regarding the funding of self build projects. That is demonstrated by the fact there has been a massive reduction in build projects in general throughout the region since 2007. According to statistics from the Highland Council’s planning department, in 2007/08 there were 1845 completed house builds. In 2012/13 this had dropped to only 833. This number has levelled off the past couple of years, with 984 new builds being constructed in 2014, and 974 in 2015. It is widely thought that a large majority of this decrease is down to the decline of self build and custom build projects in the Highlands.
HSCHT believes the main reason for the huge reduction in self build projects throughout the region is the difficulty now being encountered by people in securing mortgage finance to cover the period up and until a property is complete. As a result, mainstream “high street” mortgages are currently difficult to secure, if not impossible.
The Highland Self Build Loan Fund aims to generate growth in this “self build” sector again, and provide financial assistance to people who have in recent years been unable to progress with their self build projects.
THE FUND
£4 million is available in total to provide to individuals and families throughout the Highlands over the next couple of years. This is a revolving fund, so as some projects are completed and the loan provided to them is paid back, we will then be able to use this finance to assist another applicant. Through doing this, we hope to help as many people as possible to build their own homes.
The funding has been available since April 2016 and HSCHT are able to confirm loan agreements over the 24 months that follow.
The analysis of the pilot will be used to inform future policy for self build support in Scotland, and to provide evidence of demand to “high street” lenders.
BENEFITS
The Highland Self Build Loan Fund will allow development to occur across the Highlands, including in smaller rural communities, where housing is sparse. This will help meet the housing needs of the community, and will therefore prevent outward migration.
Individuals and families, may have found themselves spending years trying to obtain suitable finance to help them build their own homes, many of which may have spent a considerable amount of time in unsuitable living conditions. This new fund should help these people finally realise their dream, and allow them to move into more comfortable surroundings once they have eventually completed their build.
CEO of HSCHT, Ronnie MacRae has said:
“We are excited to see the launch of The Scottish Government’s Highland Self Build Loan Fund and we are delighted to be administering it. We anticipate that it could assist many Highland households to build their own homes. We welcome the new initiatives provided by The Scottish Government and it is an exciting time for housing options in the North.”
DETAILS
If you are interested in hearing more about the Highland Self Build Loan please contact The Highlands Small Communities Housing Trust on 01463 233548, or at selfbuild@hscht.co.uk. A brochure and application pack can also be downloaded from www.hscht.co.uk. Twitter - @SelfBuildFund.
