Building Scotland Fund: housing eligibility criteria

Housing eligibility criteria for the Building Scotland Fund.

Additional criteria for housing projects have been developed and are set out below. These supplement rather than replace the Building Scotland Fund’s headline criteria as detailed on our website and should be read in conjunction with those. 

The housing criteria below are designed to enable the Scottish Government to prioritise housing projects and maximise the range of benefits that can be delivered by the Fund. 

Please note that meeting the criteria below does not guarantee finance will be approved or be available. The Scottish Government retains ultimate discretion to decide which projects are approved for finance.

Essential criteria:

1. All housing tenures are eligible but investees must be classified as non-public sector. 

2. BSF minimum investment is likely to be £1m or above (as per overall BSF criteria) although the SG retains discretion to consider applications under this amount. For SME housebuilders investments of £350,000 and above will be considered. 

3. Proposals should demonstrate they are supported by the relevant local authority. 

4. The project must demonstrate that it is financially viable and capable of supporting and repaying the finance over the term sought. It should also demonstrate why mainstream lending is not suitable for the project proposed (or where BSF is being used to co-finance a project demonstrate why mainstream lending is not available to cover the full finance requirements of the project). 

5. Projects will be expected to drawdown finance within the financial year(s) they apply for and should clearly evidence the ability to do so. 

6. Security appropriate to the type of investment will be required (BSF will consider applications for subordinated debt). 

7. BSF will not cover the entire investment required by the project and any equity stakes will require to be a minority stake.

Criteria that will be applied to prioritise projects:

8. Projects that provide additional or accelerated housing to that already planned for delivery will be given priority. 

9. Projects which clearly evidence deliverability will be given priority. As part of this the site must be within the investee’s control, or have an option to purchase in place. 

10. Projects which promote quality, placemaking and accessibility will be given priority. 

11. Projects should clearly demonstrate the benefits they will deliver- including (but not limited to) supporting economic growth, reducing carbon emissions and creating sustainable places. These factors will considered when prioritising applications.

Criteria specific to affordable housing projects: 

12. For affordable housing homes contributing to the 50,000 homes target are ineligible. 

13. Housing Associations wishing to deliver homes that are additional to the 50,000 are eligible to apply for finance at below-commercial rates for projects where they will not seek other public funding in future. 

14. Housing Association projects not included in the 50,000 target and which will seek subsidy in time but at a level significantly lower than current benchmarks may be eligible for below-commercial rate finance and we will work with the applicant to calculate any potential discount to the rate taking cognisance of State Aid legislation.

15. All affordable housing projects must meet the same quality criteria as the Scottish Government’s Affordable Housing Supply Programme- as currently set out in guidance note MHDGN 2018/02.


Please note: The Scottish Government retains ultimate discretion to decide which projects are approved for finance and meeting the criteria does not guarantee that finance will be approved or available



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