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Getting it Built!
Where does the money come from?
Jon Lee, Business Development Manager
Ecology Building Society
Ecology view of community-led build
• Tackling climate change and the environmental imperative
through creation of sustainable housing stock
• Alignment of pricing with climate change risk
• Ecology BS recognised as kick-starting the market for self-build
• Our role has been to act to support self-build pioneers
• Self/community-build has been a test-bed for new ideas in a
conservative industry
• Self/community led approaches tend to quality and enhance
Community led housing mortgages
• Ability to lend to groups or individuals towards
purchase of land with outline planning consents
• Community self-build does not necessarily mean DIY
• Stage payments available benchmarked against the
increasing value of the plot / site
• Discounts for ecological and energy efficient homes
on completion for the remainder of the mortgage
• “Affinity” mortgage schemes available to members,
including bridging facilities where applicable
• We consider a range of structures and tenures
C-Change Sustainable Homes
Discount %
EcoHomes Very Good
EcoHomes Excellent
AECB Silver (Carbonlite step 1)
CSH Code Level 4
CSH Code Level 5
AECB Gold (Carbonlite step 3)
CSH Code Level 6
CO2 Emissions
Passivhaus Cohousing - Lancaster
Community Land Trust
Ecology lending model
• Individual approach – close dialogue with borrower and other
funding partners
• Loan to value – up to 80% at any stage of the project, including
purchase of land
• No set stage payments – drawdown profile is agreed with
• No differentiation on rates from our other lending
• Limits to levels development finance linked to our capital
• Concentration risk issues on residential units
• Timing and availability of grant support is critical
A few tips
• Know your budget and be realistic about timing
• Stress test your assumptions (plot, labour, materials and
professionals costs, interest rates, time, cash flow)
• Select appropriate designers and contractors
• Ask yourselves, do we have all the right skill sets in our
management team to make this work?
• Design in Passivhaus / air tightness specifications from the start
• Consider your rules and terms of leases and S106 agreements.
Are they practical and “fundable”?
• Talk to a few lenders and RICS approved valuers
• Ask if there is a valuation panel policy at lenders
A few tips
•Check Loan to Value ratios and how draw downs are
signed off
•Have a robust project cash flow model including
contingencies and a realistic timetable
•Be aware that project spend and sweat equity does not
equate to increases in interim values on the project
•Be prepared to lose members when the project
becomes “real”
•Keep key partners including funders and members fully