Loans for Communities to build homes in Cornwall

Posted on: 7th July 2018

Council offers loans to help Community Land Trusts build much needed affordable housing

Homes at Croft Mear Pendeen

Homes built by local community land trust all housing local families

Cornwall Council is encouraging Community Land Trusts to apply to its £4 million Revolving Loan Fund to help build new affordable housing for local people.

Cornwall Council Cabinet portfolio holder for Homes Andrew Mitchell said: “With the delivery of 1,000 homes a priority for the Council, working with partners to help build them is key, especially where it is a community led scheme. Community Land Trusts are important as they can deliver affordable homes in smaller rural communities where there is often acute need, but where larger housing providers may be reluctant to invest.

CLT’s are able to identify sites, unlock land and obtain local support. The Council can provide CLTs with short-term development finance at a preferential lending rate which will be an enormous help to unlocking this potential.”

The £4 million fund is open for bids from CLTs for loans of up to £1.5 million per scheme. This can be through their own schemes or working in partnership with other providers. The money will be recycled as loans are repaid, and the fund is expected to run for 7 years until 2021/22. Loans can support the development of all types of affordable housing including shared ownership, shared equity, affordable rent, intermediate rent and intermediate sale. Cross subsidy schemes incorporating an element of open market housing may also be considered.

The Fund offers

·         Loans for the development and construction of new affordable housing. Eligible costs can include purchase of land,           buildings, construction and conversion of a building.

·         Loans of between £75,000 and £1.5 million per scheme for terms of up to 18 months.

·         Loans are to be repaid within 12 months of completion of the scheme.

·         Interest will be charged at Cornwall Council’s standard loan rate (currently 4.5%)

Between 2009 and 2014 the first CLT Loan Fund lent out £3.14m which enabled 35 new affordable homes to be built.

In 2014, Land’s End Peninsula CLT used a £879,000 loan from the CLT Revolving Loan Fund to build 8 much-needed affordable homes at Croft Mear in Pendeen. Three homes were sold to local people at discounted rates, and the remaining 5 are providing affordable rented homes in the village.

Cllr. Sue James, chair of the Land’s End Peninsula CLT, remembers how satisfying it was to see the homes occupied by local families just in time for Christmas:  “It was a long haul to bring this project to fruition and the loan from Cornwall Council helped us to build 8 affordable homes in Pendeen that are protected in perpetuity and available to local people for generations to come.”

If you would like more information on the CLT Revolving Loan Fund, or to discuss a proposal please contact the Rural Housing on  01872 326353 or email