Empty homes: financial help for empty home owners

Interest-free loans of up to £35,000 per unit (subject to availability of funding and eligibility) where a property/building has been empty for 6 months or longer.

The loan can also be used towards the conversion of commercial buildings or empty spaces above shops, into residential accommodation (subject to planning consents). Each property must be sold or let/leased on completion of the works.

The loan will be secured by a first or second Charge with Land Registry and there is a maximum loan to value ratio of 80%. Any lender must give their consent to the Charge.

The loan must be repaid in 2 years if selling, or 5 years if letting/leasing (residential lets only – this loan is not available for holiday / short term lets). Interest at 6% is charged in cases of default (backdated to the date on which the loan funds were originally released). There is a minimum application fee of £395 (dependent on amount borrowed).

Grant Scheme Grants of up £25,000 (per unit) are available to empty properties in the Town Centres of Colwyn Bay, Llandudno or Abergele/Pensarn. The Grant can be used for the renovation of existing residential properties, or for commercial properties/empty spaces which can be converted into residential accommodation (subject to necessary planning consents).

Properties must have been vacant for 6 months or more and the owner must contribute to at least 30% of the cost of the works themselves. On completion, the accommodation must be leased to the Local Authority for a minimum 5 year period, during which time it will be used to accommodate homeless households. Rent will be guaranteed during this period and paid at the Local Housing Allowance rate for the property size – see Conwy Private Sector Leasing Scheme.

The Grant will be secured by a first or second Charge with Land Registry (subject to a maximum ‘loan to value’ ratio of 80%) and removed after the 5 year conditions have been met. Any Lender will need to consent to the Charge and the proposed Lease Agreement. There is nothing to repay if the terms and conditions are complied with for the period but the Grant is repayable in full if conditions are not met. Once the 5 years has ended, there are no restrictions on the tenant type/rent level, although management services can continue if requested.

There is a Grant up to £20,000 per property (subject to availability of funding and eligibility). The property has to have been empty for 6 months or longer. Application fee is £200. Properties must have been vacant for 6 months or more and the owner must contribute to at least 30% of the cost of the works themselves.

On completion, the accommodation must be leased to the Local Authority for a minimum 5 year period, during which time it will be used to accommodate homeless households. Rent will be guaranteed during this period and paid at the Local Housing Allowance rate for the property size – see Conwy Private Sector Leasing Scheme.

The Grant will be secured by a first or second Charge with Land Registry (subject to a maximum ‘loan to value’ ratio of 80%) and removed after the 5 year conditions have been met. Any Lender will need to consent to the Charge and the proposed Lease Agreement. There is nothing to repay if the terms and conditions are complied with for the period but the Grant is repayable in full if conditions are not met. Once the 5 years has ended, there are no restrictions on the tenant type/rent level, although

Welsh Government have developed this scheme for properties which have been empty and unfurnished for 12 months or longer and this must be evidenced by council tax records. It is only available for owners who intend to live in the property themselves on completion of renovation work and a condition of the Grant is that they must live there for 5 years. Properties not listed as a domestic property for council tax purpose are not eligible.

Grants will be amounts between £1,000 and £25,000 and can only be used for repair works identified by the Local Authority as being necessary (at the time of the initial visit) to make the property safe and secure, and for energy efficiency improvement works (but not only for energy efficiency works).

Owner must also contribute to the cost of the works. Grants will be secured by a Legal Charge with Land Registry and any Lender with a Charge already on the property will therefore need to give their consent for a further Charge to be taken. The amount of equity in the property at the time of registering the Charge, will need to be taken into account.

To find out more about the scheme, see answers to some frequently asked questions and to apply to join see National Empty Homes Grant Wales.

National Empty Homes Grant

For FAQs in relation to the National Empty Homes Grant, please see National Empty Homes Grant Wales.

All other grants and loans

Eligibility

Does the property have to be an existing dwelling to be eligible?

No. All funding options can be used to support works for the conversion of commercial properties, or empty spaces, into self contained residential accommodation, as well as existing properties. All properties must be marked as empty for 6 months or more within our Council Tax or Business Rates records to be eligible.

Can Limited companies apply for any available financial assistance?

Yes. However, there will be additional due diligence checks carried out on the Company and all Directors.

Is my property suitable for leasing?

When assessing suitably for leasing, we will consider location, property size and type and layout. Current target areas would be Llandudno, Llandudno Junction, Conwy, Deganwy, Mochdre, Colwyn Bay, Old Colwyn and Abergele but other areas may be considered provided they have access to regular public transport services. Of particular interest at this time would be 1-beds, ground floor flats/bungalows and wheelchair/mobility adapted properties.

Any properties offered will be considered on a case-by-case basis and dependent on our need at the time the property is offered.

Financing

Can I apply for multiple grants/loans on the same property?

Grants cannot be stacked together. However, it is possible to apply for a Grant and a Loan on the same property (subject to eligibility), provided there is sufficient equity to secure both.

Can approval in principle can be obtained before purchasing a property?

Unfortunately, approval in principle cannot be provided before a property has been purchased.

This is because we have limited funding and defined timescales within which the grant/loan funding must be committed and spent. There is also a risk that a property purchase may not proceed, for example if a sale falls through, which could result in staff time and resources being committed to applications that ultimately cannot progress.

To ensure that the available funding is used as effectively as possible, we prioritise applications where the applicant already owns the property and is in a position to progress the proposed works within the required timescales.

Is refinancing is permitted following completion of the refurbishment?

Conwy Council will secure a Legal Charge with Land Registry before releasing any funds. This must be by way of a first or second Charge. If there is an existing mortgage/finance on the property we will need the lender's consent to secure our Charge behind this (as a second Charge).

If owners want to refinance whilst our Charge is still in place, Conwy Council may agree to drop from a first to a second Charge, provided there is sufficient equity in the property to support both Charges, without exceeding an 80% loan to value ratio. We will need to see an up-to-date valuation of the property in its current form, together with a mortgage offer before giving consent.

If Conwy already have a second Charge, it will not be possible to drop to a third Charge to support other funding being secured.

I don't have enough equity in the property for your Legal Charge to be secured. What can I do?

It may be possible to secure a Legal Charge on alternative property provided there is sufficient equity in that property to cover it, as well as any other secured borrowing, without exceeding an 80% loan to value ratio. All Legal owners of the property must provide their agreement.

Works

Can I choose my own contractors?

Conwy Council are not involved with the selection of Contractors so it is down to you to select your own contractors. You should ensure your chosen contractor is value money and is suitability qualified/experienced for the task in hand. You may need multiple contractors to undertake a variety of works.

Can I do the works on a Do it Yourself (D.I.Y) basis?

You can complete certain works yourself but only the cost of materials can be included for grant/loan purposes.

I am also a developer/builder, can I still access funding if I am doing the work myself?

If the work is being completed by a Limited company building firm then it may be possible to claim funding. We will ask for three quotes for the work, instead of the usual two. We will need to assess the exact circumstances of the ownership structure and that of the building firm before confirming.

How long do I have to complete the works?

Timescale is to be agreed with the Empty Homes Officer, depending on level of required works. Certain timescales may be set to ensure funding is spent within availability period.

Process

What is your grant/loan application process?

• Eligibility checks, Suitability visit and agreement with Empty Homes Officer about which funding option will be most suitable.
• Completion and submission of application form and supporting documents.
• Empty Homes Team to complete due diligence checks on all property owners/company Directors, including credit referencing.
• Once satisfied, submission to internal grant/loan panel for decision.
• Following submission to the panel, we may ask for more information before making a decision.
• If approved, Legal paperwork to be drawn up and issued for signing.
• Return of signed paperwork, submission of relevant fee/s followed by CCBC sign off.
• Submission of Legal Charge to HM Land Registry for registration (after Companies House registration if Limited Company).
• Once confirmation of Legal Charge registration is received and applicants own contribution (if applicable) has been spent, monies to be released to applicant. Please note for larger sums, or more than one funding option, payments may be issued as staged payments.
• Work completed and overseen by applicant ensuring final standards are met. Empty Homes Officers to inspect periodically to ensure timescales are being met and work being completed appropriately.
• Final visit to sign off work and collection of safety certification.

How long will it take to get the money?

If all required documents are provided at the outset, it should be possible to have a decision on your application in approximately 3-4 weeks. There will be a further period of time after this for Legal Paperwork to be drawn up, signed and for the Legal Charge to be registered at H M Land Registry. If the applicant is a Limited Company, the Legal Charge will first need to be registered with Companies House which will increase the timescale. Once the Charge has been registered, it may take 1-2 weeks for you to receive funds.

Please note, timescales are approximate and may be affected by available resources. If we think there may be a delay, we will inform you as soon as practically possible.

Who are the grant/loan panel?

This is made up of 3 staff members including a Solicitor, Housing Services Manager and Head of Housing, Planning and Place. All panel members must give approval for funding.

What documents/information will you need from me to apply?

• Completed application form. To be provided once eligibility/suitability checks have been completed.
• Proof of ownership of the property by way of Land Registry Title Information Document, including plan (must be ‘official copy’) dated within the last month. This can be obtained online for a small fee.
• X2 forms of ID for all legal owners listed on the Title Information Document – one should be photographic ID (passport/drivers license) and the other address ID (bank statement/utility bill). A Council Officer will need to see the original documents in person to verify and take copies. If you are not local, please speak to us about how to get these verified.
• X2 quotes for the works identified.
• Proof of finance to cover applicants contribution/shortfall.

For Limited Companies we will also require:

• A copy of the Minutes of a company meeting declaring the intention to apply for funding.
• 3 years company accounts.
• Personal Guarantees from all Directors.

Once works are completed, if the property is due to join our Leasing Scheme, further documentation/safety certificates in relation to the property will also be required.

If you are renovating an empty property, you could be eligible for reduced rate VAT on renovation costs.

To be eligible your property has to have been empty for at least two years before the renovation work starts.

HMRC guidance indicates that they would accept a letter from the Local Authority confirming that your property has been empty for at least two years before the renovation work starts. If you would like to discuss the length of time your property has been empty, please get in touch.