There are many organisations that can provide funding for the various stages of your project. Some of this will be in the form of grants which will not need to be repaid, but the majority of development finance will loans, which will need to be paid back.
An excellent summary of the type of private, community and public funding available from national organisations to support community-led housing projects is provided by the National Community Land Trust Network.
A national charity, the NCVO, also manages a database of funding which you can access here.
The Nationwide Foundation, an independent charity has recently agreed to fund a number of enabling services. It hoped to launch a new open grant fund for communities some time in 2018.
Local Authorities in the York, North Yorkshire and East Riding area may also be able to provide financial assistance through the Community Housing Fund to community groups to develop projects. Check the position in your area by contacting your Council’s Rural Housing Enabler or Housing Support Officer, contact info can be found here. Further Community Housing Fund is now administered by Homes England, the Government’s national housing and regeneration agency, find out more at https://www.gov.uk/government/collections/community-housing-fund
Free advice and support may also be available from some charitable organisations including your local Rural Community Council. For North Yorkshire you can contact Community First Yorkshire. For East Riding you can contactHumber and Wolds Rural Action.
You may also be able to get some support from local charities such as:
Hambleton Community Action
Harrogate & Ripon Centres for Voluntary Service
Coast & Vale Community Action
East Riding Voluntary Action Services (ERVAS) Ltd
Selby District Association for Voluntary Service
A typical community-led housing project will need funding at three stages:
Stage 1: Getting Started
Support is available to help you to agree the sort of organisation or group you want to be and how best to work together, how to find a site and what sort of project that you are looking to develop.
Some of this support may come from your local Rural Housing Enabler but the Community Land Trust Network also provides information on the types of organisations that may be able to provide funding to help you with this stage.
Stage 2: Business Planning (sometimes called the pre-planning stage)
When you have identified a site, and decided what type of housing you want to develop you are likely to need expert advice to find out if the site can be used for housing, the development of a detailed scheme and help to apply for planning permission.
Funding is available from various sources, but to access this most organisations are likely to ask you to prepare a Business Plan to demonstrate that you have a credible and deliverable proposal. Some of the issues that you will need to consider at this stage can be found in the links below;
To access funding at this stage, you will normally be expected to be legally formed as a group.
Stage 3: Development
Once planning permission is agreed you will need funding to buy the land and pay for a builder. Most community groups will require expert advice to help them manage this process to make sure that the land is being bought at the right value and the homes are built to an agreed standard within your budget. Funding for this stage will often be available as a loan which will be based on your groups’ ability to pay back from rents or sales. Some communities also raise funding through a community share issue.
You can find out more about community shares from the following organisations;
If the loan is not enough your local Council may be able to provide a grant if it has funding from the Community Housing Fund. You can find out more by contacting your local council. Find their contact details here.
You should always seek independent financial advice before taking out any loans. Loans can be offered by any lending organisation but there are Ethical Banks which specialise in this type of project such as Charity Bank, the Ecology Building Society, Unity Trust Bank and Triodos Bank. Some schemes have also been known to use funding from Social Investment Funds such as those offered by Big Society Capital, Resonance and the Charities Aid Foundation.
Homes England also provides grant funding for affordable housing. You will need to be registered with them as a Registered Provider. Homes England produce a manual for this which can be found here.
An alternative that you may wish to consider would be to work in partnership with a Housing Association which could develop and/or manage homes on your behalf or support you in the process. Your local council will have details of Housing Associations who work in your area.