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Plans announced for Right to Build across England as self/custom build bill gets Commons green light

Consultation underway on plans to enable custom/self builders to turn to councils for land as approval in principle is given to the Self Build and Custom Housebuilding Bill

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Briefing document on self/custom build bill released before second Parliament reading

Paper provides background on Government support available to people wishing to build their own home

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15,000 custom/self build homes a year "not implausible", says new report

Proposals suggest new targets for custom/self build housing to tackle housing crisis

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South London group steps up self build campaign as more projects are established

Lewisham-based organisation plans discussion day on 34-home self build project; one of many new schemes taking shape

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Collaborative project wins top prize in the Self Build on a Shoestring 2014 competition

Team of architect, community self build group and housing association wins £5,000 prize

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Case Studies

Bickleigh Eco Village, Devon

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Stoke-on-Trent Serviced Building Plots

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Harvest House

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Forevergreen House

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Housing People Building Communities

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Sülzer Freunde, Cologne

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Berlin - 'Building Groups'

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Manor Farm, Kirton

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Straw-baling, Perthshire

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Low-cost Irish House

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Community Eco-homes, Devon

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Lancaster Co-Housing

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Cropthorne

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Findhorn

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St Just In Roseland

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Hempsted Green

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Vauban, Germany

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Warborough

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Almere, Holland

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Ashley Vale

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West Quantoxhead

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Castle Ring Wood

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The Camberwell Curve

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Trefeglwys

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Wellstride

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Hockerton

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Wokingham

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Top tips

Charlie Luxton's
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Custom Build Investment Fund

Custom Build Investment Fund

Custom Build Investment Fund

The Government have launched a new £30 million investment fund to help kick start the growth of the custom build sector and incentivise volume custom build projects across England. This new fund will offer short term loans to community groups, builders and other organisations looking to start self-build projects.

The loan could be used for up to 75 per cent of a project’s land and early construction costs, and will be available to organisations planning to build five or more homes at a total cost of up to £3 million.

The fund will be administered by the Homes and Communities Agency (HCA) nationally in the form of a loan payable in stages. Separate arrangements for London will be announced by the Greater London Authority shortly.

Details at a glance

1.Who can apply?

If you are an “appropriately constituted body” of good standing and have the capability to deliver your project you will be able to apply. Eligible applicants include bodies registered with the Charity Commission as a charity, or registered as an incorporated body with Companies House or with the Financial Services Authority as an industrial and provident society. They also include Community Land Trusts and Community Organisations recognised under the 2011 Localism Act.

Local authorities will not be eligible to apply but will not be precluded from working with an eligible applicant in bringing forward a project.

2.Type of development funded

Proposals for schemes of five residential units or more with at least outline planning permission Non-residential development, including associated community facilities such as community halls, communal accommodation or recreation areas will not be funded.

Qualifying expenditure includes:

  • Land acquisition costs;
  • Site preparation costs;
  • Construction of supporting infrastructure/utilities directly related to the construction of the homes;
  • Section 106 planning obligations,
  • Community Infrastructure Levy charges and Section 278 agreements;
  • Construction costs for the homes;
  • and Associated professional fees related to the project after planning permission has been granted.

3.Funding & Repayment terms

Funding will be given on a staged payment basis, agreed at the outset of a project, taking account of progress of work across the scheme. Interest for funds drawn down will be charged at commercial rates ranging from 2.3 to 11.7% per annum. Funding for each project is capped at 75% of eligible project costs. Repayments to become due following completion of units or sale of a set proportion of plots on the site. Funding agreements will apply ‘long stop dates’ by when any unused funding will be required to be repaid.

4.Relationship to other funding

Projects that benefit from capital funding under other national programmes such as “Get Britain Building” will not be eligible. “Community Right to Build” projects may apply for funding. Projects which benefit from deferred payment agreements under “Build Now, Pay Later” on HCA or other Government-owned land will be eligible to apply. Projects with allocations already in the 2011-15 Affordable Homes Programme may apply for funding.

5.Evidence in support of applications

Applications for funding will be assessed in a two-stage process:

  • Initial assessment covering threshold, size, mix, costs, value for money, deliverability, planning status, previous experience of delivery, meeting local area development standards and project innovation.
  • Shortlisted applications for funding will then be subject to a due diligence process to verify suitability for funding.

6.Loan Agreements

Approved applicants will enter into a loan agreement with the HCA and agreement Heads of Terms are available on the HCA website. The loan offered by the HCA at the end of the due diligence process will be based on the HCA’s view of the minimum necessary for the project to proceed. Loans will be on a commercial basis to be repaid with interest as homes/plots are sold. The HCA will lend no more than the amount agreed. No additional loan funding will be made available. All schemes in receipt of a loan will need to be managed on an open book basis. Borrowers will be required to provide regular reports on progress including construction progress, homes started and quarterly project cash flow updates.

7.How long will funding be available for?

The fund will run until 31st March 2015. Applications can be made at any time for the duration of the fund and should be made direct to the HCA if the project is outside London. If a project is in London, funding will be administered by the Greater London Authority.

8.Further information