When Julia Dunn bought Batheaston Villa it was a wreck. That was until she got council funding. By Anne Spackman
Thirty years ago, the gentry began to return to run-down Victorian and Edwardian neighbourhoods. They were welcomed by local councils with open arms and large cheques. There were grants for roofs, windows, re- wiring and plumbing, which subsidised a generation of buyers.

Since the early 1980s the government has taken the view that people should pay for their own home improvements. But a new Bill, published earlier this month, may release money for the next generation of potential refurbishers.

More than 95,000 improvement grants were handed out by local authorities last year, each at an average cost of pounds 7,500. Most of these were scattered among the owners - frequently private landlords - of unfit buildings, who were entitled to mandatory grants. As a result, the money spent had little impact, improving the odd, isolated property, rather than an entire neighbourhood.

This is about to change. The snappily entitled Housing Grants, Construction and Regeneration Bill, now being scrutinised by Parliament, will allow local authorities to give discretionary grants. This means they can target priority areas of poor private housing and attract other regeneration funding to such projects. Such schemes are currently operating in city- centre areas of Newcastle and Liverpool, with the backing of English Heritage. The new Bill should extend such schemes into more residential areas.

But before you rush out and buy a wreck, remember such projects take a long time to evolve and that the queue for money is already very long. John Cornhill, the assistant director of housing for Newcastle City Council, who welcomes the proposed change, also warns that regeneration budgets are decreasing every year. "Every local authority has an enormous waiting list for grants," he says. "The good thing about discretionary grants is that we will be able to target the money more effectively and integrate it with other improvements."

Most local authorities still provide help for elderly owner-occupiers with minor improvements such as roof repairs and rewiring. The grants are usually for around pounds 1,000 and are means-tested. After that, only cities renowned for their architecture tend to offer public money to individual home owners. Cheltenham has given grants for the restoration of cast-iron railings. Bath has offered architectural-features grants for up to half the cost of restoring windows, railings and balconies on some of its most prestigious streets.

The other category of grant recipients is the people who try to rescue special buildings from ruin. Listed buildings can attract English Heritage money, sometimes through a joint partnership with the local authority. In other cases a city will decide it is worth helping an individual owner- occupier because the city as a whole will benefit.

This is the kind of civic partnership that has been formed between Bath City Council and the new owners of Batheaston Villa on the city outskirts. In the late 18th century the villa was a fashionable literary landmark.

By the time Jane Dunn and her partner Nick Ostler came to Batheaston Villa, the property was condemned. "I first saw it in cold twilight, its beautiful floors pooled with stagnant water," Jane recalls. "The more we have opened windows, removed damp and decay, the more we have appreciated the character of the place."

The house is on three storeys with four grand rooms on each floor. Many of the original features, including the shutters, the Georgian glazing bars and the fire grates, have survived years of neglect. But the rain has taken its toll. The house requires a new roof, new wiring, new plumbing, some new floors - and that is before a kitchen or bathroom are put in. Jane and Nick hope to move in in April, once the basic services are connected. "We will proceed according to our finances after that," says Jane.

The building had always ranked high up the priority list of the city council's conservation department. They are paying for 40 per cent of items eligible for grant aid, including the roof and the dry rot. Simon Harris, the surveyor in charge of the work, estimates the total repair bill at around pounds 150,000. "Without the grant, I don't think anybody could have taken this on as a private home," Jane says.

The council has provided more than purely financial support. David McLaughlin and Bob Sutcliffe, the two senior conservation officers, have been sources of enthusiasm and expertise on the history of the house. The council has helped with the landscaping of the garden, which includes a temple, and has been a good source of expert craftsmen. There are fears that such partnerships may not survive the merger of Bath City Council into a broader local authority.

When Jane and Nick arrived at Batheaston they wrote to their new neighbours, explaining their planned restoration and apologising in advance for any inconvenience caused by builders. They received back a series of affectionate responses which underlined the community sense that the house belonged to more than just its new owners. "This is an example of the grants system at its best," Jane says. "The house matters to Bath and it matters to us."

With half our housing stock now over 50 years old it is not just 18th- and 19th-century residences that need to be refurbished; many houses built in the 1920s and 1930s are starting to deteriorate. Perhaps the fashion among the next generation of refurbishers will be to colonise suburban estates of semi-detached homes and use grant money to restore their original features.