A pot of £10m has been allocated to the scheme, which is running initially in Glasgow, Argyll & Bute and Perthshire. Equity loans of up to £40,000 are on offer and can be used either as a single equity loan or with other existing Scottish government grants to fund more expensive measures like solid wall insulation or energy efficiency works.
Under the scheme, eligible home owners will borrow from the Scottish government to fund repairs and energy efficiency improvements, and repay the loan when the property is sold, they transfer ownership, or they die. There will be no monthly interest, with the amount repaid linked to the value of the house at the time the loan is paid back.
Housing minister Kevin Stewart said: “We know leaking roofs and poor building structures can drive up energy bills and make them more difficult to heat, but for low income households they can often be too costly to repair. This £10m scheme will provide households with loans to carry out essential repair work and install energy efficiency improvements.”
Mary Taylor, chief executive of Scotland Forum of Housing Associations, said: “We welcome the announcement of the equity loan scheme. It is extremely important that we invest in the energy efficiency of existing homes to provide affordable warmth and reduce carbon emissions. It is also important that we invest in existing buildings and keep them in a good state of repair.
“We know from our members that it can be a challenge for housing associations to organise repairs and energy efficiency measures in mixed ownership properties, especially tenements with other owners in the stair. This new equity loan fund, coupled with the Under One Roof website, which the SFHA helped sponsor, provide potential solutions to allow owners to fund repairs and energy efficiency improvements."
David Bookbinder, director of the Glasgow and West of Scotland Forum of Housing Associations (GWSF), added: “It has always been clear that equity loan schemes offered by commercial companies won’t be attractive to owners. We therefore warmly welcome this Scottish government pilot initiative which offers a really good deal for owners who have some equity in their property but can’t afford to pay regular loan interest.
“As well as facing the challenge of dealing with energy efficiency and other works in mixed tenure blocks, a number of community based housing associations would also like to work with their local council to tackle fully private tenements which are in poor condition and an increasing blight on the area. Widening the range of financial options for owners can only increase the chances of making this happen. GWSF very much hopes that the scheme can be expanded across Scotland after this pilot in three council areas.”