Scottish Government announces emergency loan fund for housebuilders during coronavirus pandemic
Housebuilders will be able to apply for short-term loans of up to £1 million from the Scottish Government to support them through the Covid-19 outbreak.
Small and medium-sized enterprises (SMEs) with liquidity issues due to the temporary closure of the housebuilding sector will be able to apply to a £100 million Scottish Government emergency loan fund.
The fund aims to: safeguard jobs and protect suppliers; support the post-coronavirus economic recovery and the continued supply of homes; and retain diversity of the housebuilding sector.
Housing Minister Kevin Stewart said: “To save lives and protect the NHS during the coronavirus outbreak all non-essential construction work has been halted.
"This decision was not taken lightly and I know it is having a profound impact on the housebuilding sector, particularly smaller businesses which are struggling to cope with delayed house sales and the increased costs associated with site shutdowns.
“This new loan fund is open to small and medium-sized housebuilders operating within Scotland. It will provide urgent support to address liquidity pressures facing housebuilders and will help ensure their future.
“I would like to thank everyone in the sector for their support during the coronavirus pandemic and assure them that the Scottish Government is committed to safeguarding jobs and putting plans in place to ensure economic recovery over the months and years ahead.”
Nicola Barclay, the chief executive of Homes for Scotland, said: “This welcome short-term intervention will offer a lifeline for many smaller home builders who play a major role in their local areas in terms of meeting more rural housing need, investment, employment and sustainability.
“Of course, their longer-term survival depends on a safe phased return to work and we continue our close engagement with the Scottish Government on how this can be achieved as soon as possible.”
Applications for loan support will be accepted from 2pm on Monday, May 18, via the Scottish Government website where full details on the criteria for the fund will be outlined.
Applicants should be SME housebuilders with a turnover of £45 million or less per year and building five or more homes per annum – they should only apply for funding that is necessary for the short term.
Loans are capped at £1 million and most loans are expected to be repaid within two years with interest rates set at two per cent.
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