Last year the government introduced a £3billion Home Building Fund, which is available to larger builders and developers, as well as “smaller builders, community builders, custom builders and regeneration specialists”.*
The Home Building fund is led by the Homes and Communities Agency (HCA) to provide both ‘development finance’, to cover the costs of building homes, and ‘infrastructure finance’, to help with site preparation.
HCA’s aim is to try and encourage change and improve the kind of homes that are built and the way they are delivered. Therefore, they have taken a flexible approach to the way these loans are distributed.
Loans of £250,000 to £250million are available, with smaller loans available for innovative housing. These loans are also delivered on either a short or long term basis for successful applicants.
A few other points you should be aware of:
- Loans for development work will typically cover five years, which increases to 20 years for infrastructure loans
- Interest is payable at pre-agreed rates
- Sales income can be recycled to minimise the loan request
- Successful applicants can draw down the loan up to 31 March 2021
Who can apply?
The core eligibility requirements are as follows. Applicants must:
- demonstrate that without this loan the scheme would not progress or progress as quickly, or at all
- carry out developments in England
- be a private sector entity with a majority stake in the site it is seeking funding for
- be building a minimum of 5 homes
- be a UK registered corporate entity
- be carrying out infrastructure projects, which will lead to the development of new housing
The government is prioritising developments that offer the best value for money, have clear local support and provide the greatest potential for early delivery.
The Home Building Fund is a great resource for not only established builders and investors, but also those new to the sector. If you meet the above eligibility requirements, contact us (email@example.com) for further information or contact the Home Building Fund directly at Homebuildingfund@hca.gsi.gov.uk or on 0300 1234 500.