Housing Emergency - Open Market Acquisition - Dervaig, Mull
Argyll and Bute Council · 26 June 2025
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ARGYLL AND BUTE COUNCIL COUNCIL DEVELOPMENT AND ECONOMIC GROWTH 26 JUNE 2025 HOUSING EMERGENCY – OPEN MARKET ACQUISITION – DERVAIG MULL 1.0 EXECUTIVE SUMMARY 1.1 The main purpose of this report is to provide information on the pressures on the housing market on the island of Mull. The report will confirm the continuing high level of housing need and demand on the island. 1.2 The report will outline a quick and effective way to help address the housing need and demand through an open market acquisition process through a partnership between Mull and Iona Community Trust (MICT), the Scottish Government and Argyll and Bute Council. 1.3 The report will detail the proposal to buy a property in Dervaig, Mull. The property will be used for affordable principal home, long term occupation. RECOMMENDATIONS It is recommended that the Council:- i. Approve a grant of £12,000 from the Strategic Housing Fund to enable MICT to acquire a property in Dervaig. This approval will be in addition to the £16,220 Council funding already provided to the project.
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ARGYLL AND BUTE COUNCIL COUNCIL DEVELOPMENT AND ECONOMIC GROWTH 26 JUNE 2025 HOUSING EMERGENCY – OPEN MARKET ACQUISITION – DERVAIG MULL 2.0 INTRODUCTION 2.1 In June 2023 the Council declared a Housing Emergency due to the pressures on the housing system across the local authority area. In November 2023 the Council held a summit with partners to agree a joined up approach to tackling the emergency and an Action Plan was published in June 2024. One of the 4 key areas of activity highlighted in the Action Plan was to make best use of existing homes. 2.2 This report details an innovative way to retain housing for principal occupation on Mull, an island which has a demonstrated high need and demand for affordable housing. 3.0 RECOMMENDATIONS 3.1 It is recommended that the Council:- i. Approve a grant of £12,000 from the Strategic Housing Fund to enable MICT to acquire a property in Dervaig. This approval will be in addition to the £16,220 Council funding already provided to the project. 4.0 DETAIL Background: The Housing Situation in Dervaig 4.1 There are around 170 homes in the village of Dervaig of which 16% are deemed ineffective in terms of meeting local needs i.e. 15 are second/holiday homes and a further 12 are empty/long term unoccupied (sourced from Council Tax
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Records). In addition, there are a number of short term holiday lets and there are only 7 mainstream social houses in Dervaig. 4.2 Affordability on the open market remains a significant issue for local residents. The average achieved house price on Mull is £266,750. As a result at least 83% of local households could not afford to purchase on the open market; and therefore require alternative affordable options such as social rent and shared equity. 4.3 Expressed demand for social rented housing is registered via the HOMEArgyll waiting list, and there are 10 active applicants with Dervaig as first or second area of preference with 4 of the 10 applicants having been awarded housing need points (HOMEArgyll waiting list December 2023). There has been no turnover in the social rented stock in recent years. One Solution 4.4 The Council works closely with the RSLs and Community Housing Trusts to enable the delivery of additional affordable housing across the local authority area. The traditional route of delivery is new build housing but since the Housing Emergency there has also been a push to pursue open market acquisition opportunities in areas of high housing need and demand. 4.5 The Council promotes a ‘buy back’ scheme on the Council website which encourages homeowners looking to sell their properties to get in touch so that the Council can work with an RSL or Community Trust alongside the Scottish Government to enable the purchase of properties for affordable to rent principal homes. At May 2025 there have been 24 properties brought into the affordable rented sector through this route. They have all been through RSLs. The property detailed in this paper will be the first Community Trust purchase. Mull and Iona Community Trust (MICT) has a portfolio of 7 affordable rental properties on Mull which has helped to increase the number of affordable houses for rent on the island. 4.6 A 2 bedroom property became available for sale on the open market at Oakfield, Dervaig for £230,000. Dervaig is an area of high housing need and demand. Various new build affordable housing developments have been proposed for the area and have been included in the Strategic Housing Investment Plan but no new affordable housing delivery has been achieved in the area in recent years. Mull and Iona Community Trust (MICT) are an established landlord of affordable properties to rent on Mull and have Rural Housing Body status. 4.7 MICT have secured a Rural and Islands Housing Fund Grant of £184,220 from the Scottish Government to assist with the purchase of the Dervaig property. In addition, the Council has awarded £4,220 from the Strategic Housing Fund (SHF) feasibility fund, and £12,000 from the main SHF fund. The additional £12,000 SHF fund request will ensure the financial viability of this innovative project.
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5.0 CONCLUSION 5.1 The innovative approach to securing more affordable housing in areas of high housing need and demand is a cost and time effective response to the Housing Emergency and delivers affordable housing in the communities most in need. 5.2 The additional £12,000 Strategic Housing Fund request in this paper would reduce the pressure on MICT in terms of the level of private finance that they would require enabling them to invest in the property and also ensure that the organisation will be in a position to pursue further open market acquisition opportunities on the island if and when they arise. 6.0 IMPLICATIONS 6.1 Policy – the proposal is consistent with current Council policy including the SHIP which supports the Local Housing Strategy (LHS) vision and outcomes which are directly aligned with the overarching objectives of the Outcome Improvement Plan 2024-2034 – housing is one of three key policy areas identified. In addition, the Housing Emergency declared by the Council in 2023 has ‘making best use of existing homes’ one of the four key objectives. 6.2 Financial – the £12,000 SHF request is in addition to the Officers mandated level and feasibility funding. There are sufficient funds in the SHF which is a ring-fenced housing budget. 6.3 Legal – none. 6.4 HR – none. 6.5 Customer Service – none. 6.6 Risk – there is a risk of depopulation, damage to the economy, a risk to delivering essential services in the local authority area if partners cannot effectively tackle the Housing Emergency. 6.7 Climate Change – making best use of existing stock by bringing empty properties back into use and installing energy efficiency measures helps towards achieving climate change targets. 6.8 Fairer Scotland Duty - the delivery of housing opportunities across Argyll and Bute facilitates social-economic opportunities for all. The activity in the report links to the Child Poverty Strategy. 6.9 Equalities – protected characteristics – the activity outlined in the report is consistent with the aims and objectives set out in the Local Housing Strategy which is subject to an EQIA. 6.10 Consumer Duty – this housing project delivers an affordable housing opportunity on Mull for eligible households
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6.11 Island Communities – many of the housing projects detailed in the report are being delivered on the islands which will provided many benefits such as employment and the continued delivery of essential services to island communities. 6.12 Children’s Rights and Wellbeing – the delivery of more housing options for HSCP and other workers will enable more children to have a safe secure environment. Kirsty Flanagan Executive Director with responsibility for Development and Economic Growth Policy Lead for Housing – Councillor Jim Lynch May 2025 For further information contact: Fergus Murray – Head of Development and Economic Growth Fergus.murray@argyll-bute.gov.uk Matt Mulderrig – Development Policy and Housing Manager Matt.mulderrig@argyll-bute.gov.uk Douglas Whyte – Team Lead Housing Strategy Douglas.whyte@argyll-bute.gov.uk