Another home built with assistance from the Highland Self Build Loan Fund has reached completion, providing a suitable home for a local family based on the Isle of Skye.
The Highland Self Build Loan Fund was launched by the Scottish Government in April 2016, and ever since has been providing financial assistance to self-builders around the Highlands.
Scottish Government originally launched the pilot fund in an attempt to rejuvenate what was once the main housing delivery model in the Highlands, and generate economic activity in the area, through encouraging growth in the “self-build” sector again. It is being administered by The Highlands Small Communities Housing Trust.
This initial pilot scheme - allocated to Highland Council region - provides applicants with up to £175,000 to help them build their own home. The Scottish Government loan is then repaid by the applicants upon project completion, when they have managed to obtain a mortgage from the likes of a bank or building society.
This particular couple were able to obtain a piece of croft land from a family member, before moving into an on-site static caravan with their two children. Their final goal was to eventually build their own family home adjacent to the croft land they planned to eventually work.
Provision of self-build mortgages is not as prolific as it once was. Since the financial crash in 2007/2008, the number of lender offering self-build mortgages has decreased drastically. The few lenders who do still offer such products, often hold strict policies which mean that many do not qualify. Reasons for being denied a self-build mortgage can vary from, because the applicant is self-employed, or wishes undertake too much of the work themselves to the fact land was gifted from a neighbouring family member.
Having previously been turned down by banks and other high street lenders due to the fact they wished to undertake much of the construction work themselves, when the Highland Self Build Loan Fund was announced in 2016, this particular couple saw it as a way to finally build their ideal family home.
Borrowing a somewhat modest amount, the applicants have managed to build to their predicted budget, with the whole project taking about a year to reach completion. They are now in the process of repaying the Scottish Government loan, having secured their final mortgage with their chosen lender with relative ease.
Having self-procured the entire custom build project, the applicants have been able to maintain full control throughout both the design and construction phases. A timber kit was provided by a local highland-based kit manufacturer before being erected by the self-builders themselves. They then went on to undertake the majority of the outstanding work themselves, while also making use of various contacts they had when required. This was a great example of how involved a self-builder can get in their project, with the applicant taking on much of the construction works, including works such as some internal joinery and fitting of the kitchen, installing underfloor heating and wood burning stove, as well as the drainage fittings and external groundworks.
The family have now moved into their home - providing them with large amounts of space compared to the static caravan they have been residing in the last two years.
The house is a great and considered design and provides the family with a modern and energy efficient home. Despite the high quality design and specification, the couple have managed to build relatively affordably, through undertaking the whole management of the build themselves, while also dedicating the majority of their spare time to undertaking large amounts of building work themselves. Through effective management and determination to be fully involved in the construction itself, they continued to identify savings along the way.
The final result, is a home, which should they have purchased a similar home on the open market, would have cost them a considerable amount more.
Living adjacent to their croft land would not have been possible, if self-build finance was not available to them. Many crofters struggle to find suitable accommodation even relatively close to their crofts. Now that this family have completed their build and moved into their new home, they plan to work the croft and are looking at introducing cattle to the land in the near future.
Housing provision in rural areas such as this one is sparse, and it is often impossible to find a suitably sized home within an affordable budget. In the likes of the Isle of Skye many homes are also retained as holiday homes, which pushes up property prices even further. The Highland Self Build Loan Fund has allowed this family to live in the area they want, alongside their friends and family, and build a home which suits the needs of their family, as well as their budget.
The self-builders are extremely happy with their new 3 bedroom family home, and are very appreciative that they were able to obtain financial assistance from Scottish Government.
They have stated: “The Highland Self Build Loan Fund has heled us, when we had all but given up building our own house. The Highlands Small Communities Housing Trust have been amazing in all they have done to help us from the outset, nothing was too much to ask… making a stressful time much easier. This fund has let us build on our croft, meaning we can work it properly and be near both out families.”
The family are extremely grateful for the Highland Self Build Loan Fund, and have said: “We felt physically and emotionally supported, without the support of HSCHT, we would never have continued with our self build plans.”
The Highlands Small Communities Housing Trust is delighted to hear such positive feedback, and look forward to seeing other self-builders complete their projects in the near future.
This initial pilot scheme has proved very popular, and has generated huge amounts of enquiries, both in Highland and elsewhere – demonstrating the high demand there is for self-build opportunities around the country. Following the success of the Highland Self Build Loan Fund, Scottish Government have taken note of this, and are currently working on the launch of a national Self Build Loan Fund.
To learn more about the fund, or to download an application pack, please go to www.hscht.co.uk/highland-self-build-loan-fund or get in touch via 01463 233549 or firstname.lastname@example.org.
Loans of up to £175,000 are now available to help people build their own homes in the Highlands.
The Scottish Government’s £4 million Highland Self-Build Loan Fund which launched in April 2016 is extending opportunities for people to self and custom build homes across the region.
The available loan funding has now been increased from £150,000 to £175,000 to help an even greater number of people across the Highland Council area.
The Highland Self Build Loan Fund is a Scottish Government pilot scheme which aims to rejuvenate what was once the main housing delivery model in the Highlands, and generate growth in the “self-build” sector again. It is being administered by The Highlands Small Communities Housing Trust, who are now accepting applications.
The fund will increase economic activity in the area and provide financial assistance to people who have in recent years been unable to progress with their self-build projects.
Announcing the changes to available loan funding, Housing Minister Kevin Stewart said:
“This £4 million Self-Build Loan Fund is an important opportunity to address the lending difficulties experienced by households looking to build their own homes, and explore how we can increase housing supply while allowing customers to input into the design.
“We have taken on board feedback that the £150,000 cap is too restrictive, which is why we are now increasing this cap and making loans of up to £175,000 available for people to build homes that can better suit their needs. We will continue to monitor and review the pilot over its two year lifespan.
“This loan fund is part of our More Homes Scotland approach. The government is determined to accelerate housing supply across all tenures, to support families across Scotland get on the housing ladder.”
The Highland Self Build Loan Fund is already providing loans which are allowing development to take place across the Highlands, including in smaller rural communities, where new build housing is scarce. This will help meet the housing needs of the community, and will therefore prevent outward migration and boost local employment and skills.
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 will help these people finally realise their dream, and allow them to move into more comfortable surroundings once they have completed their build.
CEO of HSCHT, Ronnie MacRae has said:
“We are delighted to see in the upper limit increased for applications to £175,000. The Scottish Government’s Highland Self Build Loan Fund now has the potential to assist many more Highland households to build their own homes and provide the added social and economic benefits at the same time. We welcome this flexible and responsive approach and the many other new initiatives being provided by The Scottish Government. It is an exciting time for housing options in Scotland.”
The Highlands Small Communities Housing Trust is very excited to announce the launch of the Highland Self Build Loan Fund. It is a new Scottish Government fund, to be administered by HSCHT.
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. The fund allows HSCHT acting as agent to the Scottish Government to provide a revolving fund to self builders throughout the Highlands.
The Highlands were chosen by the Scottish Government for this two year pilot scheme, after it was noted that the area has a 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 applicants in securing mortgage finance to cover the period up and until a property is complete. As a result, mainstream “high street” mortgage is 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 individuals and families who have in recent years been unable to progress with their self build projects.
Over the last few years the Highlands Small Communities Housing Trust has had many communities, community groups and individuals contact them seeking assistance. HSCHT has been restricted in its ability to help them due to the fact that the financial market is not providing the required lending in the Highlands of Scotland. For this reason we are very excited to finally be able to help people around the Highlands, who have long desired to build their own homes.
HSCHT will keeping a database of all the people expressing interest in the fund, in hope that this will prove to lenders that there is a high demand, and that it is indeed possible to finance these type of projects.
This year’s Rural Housing Scotland Conference, was held at Birnam Arts & Conference Centre on Friday the 26th of February 2016. The conference examined affordable housing in rural Scotland, with the main speaker – Margaret Burgess MSP, Minister for Housing & Welfare, discussing the new Rural Housing Fund, the Scottish Government’s proposals for affordable housing, the impact on the Land Reform Bill on rural housing opportunities, and community empowerment. On top of this, this is where Margaret Burgess also announced the Highland Self Build Loan Fund.
HOW IT WORKS
£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 will be available from the start of the new financial year (April 2016) and we will be 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.
The new fund will allow applicants to borrow up to £150,000, to help them reach build completion. The loan is then repaid when the applicant is able to access a traditional mortgage.
The HSBLF can help a wide range of people who are considering a self build project for their primary residence. Those who own or part-own a home can apply although they need to sell their interest in that property.
In addition, the HSBLF applicants will be prioritised in the following order:
1) Applicants with all necessary titles, permissions, warrants and other documentation requested during the application process.
2) Applicants with shorter build programmes. This is to allow us to provide more funding for a greater number of projects – allocating funding to a larger number of applicants between April 2016 and April 2018.
3) Applicants with greater housing need.
The agent (HSCHT) will assess the project costs and compare this with the applicant’s contribution. If there is a shortfall in cash flow to reach completion stage (where mortgage funds become available), this will be the basis of how the HSBLF amount is calculated.
The duration of the fund being available to each applicant will depend on their build schedule. This will be decided before a formal offer is made. The loan offered to the applicant can be drawn down over the course of the project build – at stages previously agreed during the application stage.
While the launch of the Highland Self Build loan Fund is great news to those who have been struggle to achieve financial assistance to build their own homes over recent years. It also brings a number of wider 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, especially of young people unable to access secure and affordable housing in their community. The supply of affordable housing to smaller communities is the basis of a massive amount of the work The Highlands Small Communities Housing trust undertakes. A large benefit in the provision of new housing to rural areas, is that is allows families and individuals with desirable skills to stay within the area.
The Highland Self Build Loan Fund also provides opportunities for local contractors who rely heavily on self build in rural areas. Many self and custom builds make use of local tradesmen, reducing their travel, costs and carbon emissions.
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.”
If you are interested in hearing more about the Highland Self Build Loan please contact us on:
01463 233548, or at
A brochure and application pack can also be downloaded from HERE.
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This blog will feature a wide variety of HSCHT’s developments and types of projects located throughout the Scottish Highlands. It will also include the latest news and updates regarding the trust.