Building your own home can be both one of the most rewarding and the most stressful things you will ever do in your life. There are numerous benefits to building your own home, as well as many pitfalls waiting to catch out the unprepared. Planning and proper preparation is one of the key themes of DIY Extra, but when building your own home these skills take on a whole new meaning. This guide will introduce you to some of the many things you need to think about if building your own home.
Raising the Finances
Some lucky people may have the cash required to build their own home, but the vast majority of the 20,000+ people who build their own home each year in the UK need to borrow the money they need to complete the build. This is being made increasingly easy due to many high street banks and building societies offering Self-Build Mortgages.
The main difference between a Self-Build Mortgage and the traditional House Purchase Mortgage is that self build mortgages release the money in stages as the build progresses. There are generally two different types of self-build mortgage offered, arrears based and advanced payment. Both of these mortgage options usually offer payments over 5 stages, with the payments made after completion of a stage in the case of the arrears based deal, and in advance of the stage in the advanced deal. Advanced payment self-build mortgages are less easy to find due to the obvious risk involved for the lender.
There are several things you will need to check when thinking about a self-build mortgage. Firstly, will your lender allow you to stay in your current home at the same time as having the self-build mortgage? Some will and some won’t, and this could mean the difference between living in a house and staying in a caravan on site for the duration of the build.
You will also need to plan a realistic budget and schedule for the building work. The lender will always need to see this before they will agree to lend you any money. Some lenders will also be unwilling to lend you the money if you are doing the work yourself rather than employing tradesmen. The rules vary on this (some will allow you to do selected jobs on the site, some will insist all work is carried out by qualified builders, etc) so be sure to find out.
Another essential is insurance. You will be borrowing a large sum of money, which will still be payable whatever happens to the house. It is possible to insure against some of the many potential pitfalls of self-building.
Finding a Plot
At one time buying a plot of land to build a house was relatively cheap, but as house prices have risen, along with the popularity of self-build, so has the price of building land. Britain is a tiny country, and as such land is at a premium. Do a quick Google search and you will find building land for sale in places such as Florida for as little as $25000 (around £12,500) per acre. The same size piece of land in the UK could cost 20 or 30 times that. But don’t panic, not many single dwellings require an acre of land (unless you want a HUGE house or a massive garden).
The first thing you need to do is decide how much land you actually require. 1/8th of an acre (roughly 15m x 33m) will happily accommodate an average sized 4-bedroom house, including a decent sized garden. Even 1/10th of an acre will fit an average sized house on it easily, assuming it is not an irregular shape. Once you know how much land you need you can start the often-arduous task of finding a plot.
Finding Your Plot
There are numerous ways to find a plot of building land for your proposed self-build project.
Local Estate Agents
Visit you local estate agents and see what plots they have on their books. This is also a good way to find out how much the average building plot costs in your area. However, not all estate agents deal with land and even if they do you may find that land advertised with agents is fairly expensive (the sellers are obviously aware of the potential of the land if they have instructed agents to sell it).
Contact developers in your chosen areas. Developers often hold a “landbank”, a portfolio of land they have bought over the years with a view of building on it at some point in the future. Land may remain in this landbank for several reasons (e.g. it would be difficult for them to maximise profit on it). Developers may also be willing to sell off irregular shaped plots on existing developments. This will obviously dictate the layout for your house, but is still worth investigating.
Land is often sold at auction for various reasons. Ask local agents to be informed of upcoming auctions in your area. Auctions can be a great way to save some money on land if you have a mortgage already in place (or have the cash available through other means).
Carefully check the local papers and gazettes. This is a good source of information about land that may be auctioned and also proposed developments. You can also sometimes find land for sale in the classifieds section.
Most councils, like developers, also have a landbank. Periodically they will sell off parcels of land, either to developers or individuals. Get in contact and see what they have available. You can find a directory of local councils here
Utility providers (water, gas, electricity companies) will sometimes have land available for sale due to relocation of electricity sub-stations, etc. There may be additional costs involved such as removing the defunct equipment, so you need to tread carefully. However, this can mean that big developers are less interested in the site.
Specialist Plot Finding Services
There are several companies who specialise in finding building plots all over the country. Here is a small selection, but many more can be found with a quick search online.
Going Out and Looking
Finally there is good, old-fashioned leg work. Get out and have a look around your local area. Look for derelict buildings you might be able to buy cheaply and then demolish to build your own home, and even properties with large gardens that may be willing to sell off a corner of their land for you to build on.
If you find a piece of land which you think may be suitable, but cannot find who owns it, you can contact The Information Centre on 0171 917 8888 for information about every piece of land in the country.
A Note on Planning Permission
When you are looking for your prized plot of land you will often see it advertised as OPP or DPP:
DPP (Detailed Planning Permission) – If land has Detailed (or Full) Planning Permission it is at the stage where building could commence immediately.
OPP (Outline Planning Permission) – This means plans have been submitted and initial planning permission granted. However, you will need to submit detailed plans before full consent is granted.
Undertaking a self-build allows you a lot more scope on the exact building methods used on your house. However, if you need to use a self-build mortgage you will need to check your lender allows you to use certain building styles. You also have to consider the surroundings of the plot. A plot between two 17th century thatched cottages is not ideal for a glass and steel modernist cube (you might think it is, but your neighbours in the cottages certainly won’t). So what are your options?
Brick and Block
The traditional building method used in the UK, brick and block construction is based on the tried and tested method of an inner skin of blocks with a facing skin of bricks, with insulation sandwiched between. Great for resale reliability (UK buyers are most comfortable with this building type) but not ideal if you want an open plan layout or if you want something unique.
Very popular in Scandinavia and Northern Europe, and growing in popularity in the UK. Timber Frame houses offer a wide range of styles from traditional brick faced designs, to the more Scandinavian wooden faced styles. Timber frame house kits are relatively cheap, but remember that they rarely include facing bricks, tiles, plumbing, etc.
Rarely used for residential buildings in the UK, but a very popular building method in the US. Steel framed house kits allow for a very open plan design and can be put together fairly quickly. Bear in mind that you will probably need to buy the kit on a supply and fit basis, rather than just buying the kit and getting your own builder to erect it.
SIP’s (Structured Insulated Panels)
Another building method popular in Scandinavia and also the US, SIP’s are factory built panels, which slot together to create a very thermally efficient house. The designs available might currently be a bit limited, but this fast and efficient building method has many benefits.
There are obvious pro’s and con’s with each of these choices (and this list is by no means exhaustive), but the most important point to remember is to make sure you or your builder is comfortable working with the building technique you choose. Assuming you are buying a house kit (definitely the safest choice for the self-builder), the company providing the kit will, in most cases, erect the structure for an additional price. Some self-build kits are priced to include the erection.
Below you can see a list of some of the many companies who offer self-build house kits in the UK:
Getting planning permission has the potential to be the biggest barrier to building your own home. If you have bought a plot with detailed or outline planning permission (recommended and probably applicable to 90% of people) then you should be fairly safe. Problems might still occur if you wish to drastically alter the proposed dwelling, but as long as you stick roughly to proposal already submitted, things should go smoothly.
How to Apply
Always assume a new build will require planning permission. Your local council will have a development plan for the area, outlining what will be acceptable both now and in the future. It is worth contacting them to find out as much as you can about the development plan. You may well be able to work with your architect or self-build house kit supplier to better meet particular criteria.
You don’t need to own a piece of land to apply for planning permission on it (strange but true). However, you do need to inform the owner as well as the leaseholder if they have more than 7 years left to run on the lease. You also need to inform any agricultural tenant.
Once you are ready to apply, contact you local council planning office and request a planning application form. You will need to decide if you are submitting an OPP or a DPP (Outline or Detailed Planning Permission). Complete the form and send it back along with the correct fee and any supporting documents. You now simply have to wait for the application to be approved or rejected. If it is approved (and it was a DPP), you can start to build straight away.
You can find out exactly how much the fees for submitting a Planning Application Here, on the Planning Portal website.
If your application is rejected, you have a couple of options. First of all, talk to a planning officer and try to get some clues as to why it was rejected, and then you can change the application accordingly and re-submit. Do this within 12 months and you will not have to pay the application fee again. You also have the option to appeal to the First Secretary of State. Appeals are a last resort and can take several months to resolve, with no guarantee that decision will be overturned. You have 6 months from the date on the application decision letter to appeal, should you wish to do so.
Assuming you have your DDP in place, you then need to apply for Building Regulations consent. Building Regulations are there to make sure the house you build will be structurally sound and poses no danger to both the occupier and the public. A building inspector will arrive to check up on the build at various stages. If things are not being done to his liking, he is legally able to order them made good.
The Good News and The Bad News
As mentioned before, over 20,000 people a year build their own homes in the UK. However, it isn’t for everyone. There can be a huge amount of stress involved, you may have to put up with living in a caravan next to a building site for a couple of months, unforeseen problems can drain your funds and unreliable tradesmen are an all-to-real worry. Here we will list what we see as the Pro’s and Con’s of self-build, hopefully to help you better make this important decision.
The Good News
1. Save Money
Possibly the most appealing benefit is the potential money you could save. Buy a ready-built house from a developer and you are paying for the build and land costs, plus the developers’ profit margin. Build your own house and the developers profit stays in your pocket (or is used to create a bigger or higher specification house than you could normally afford).
2. Tax Savings
At a time when we seem to be taxed at every turn, you will be pleased to know that ALL materials and labour used for building your home is VAT free! You will have to pay the VAT initially, but once the build is complete, you can submit your invoices and receive it all back, usually fairly quickly. If you are using a single, VAT-registered builder, their bills for labour and materials should not include VAT. This also applies to conversions of barns, churches, etc, into dwellings (but sadly not renovations unless the property has been empty for 3 years).
3. Creative Freedom
Don’t like the idea of living in a nondescript brick box that looks exactly the same as the other 20 houses in the street? Self-build allows you to have a house that is as individual as you (or your architect) can imagine. Want vaulted ceilings and open-plan living spaces? Go for a steel frame kit. Like the idea of lots of bare wood and clean lines? Choose a Scandinavian style wood frame house. The possibilities are endless.
The satisfaction of creating something yourself, even if you didn’t actually lay bricks or plaster walls. You will have seen through, from start to finish the creation of your home. What better feeling could there be?
The Bad News
This is no small undertaking. Building your own home can be stressful in the extreme. Dealing with tradesmen, dealing with your lender, juggling finances, scheduling build stages. If any one of these things is handled badly, you could see a big rise in both time and costs of your self-build. Self-builders, or certainly the more hands-on self-builder, seem to all have a good ability to organise. An essential skill!
One of the biggest worries for the non hands-on self-builder is picking the right builder. Your home is essentially in their hands and a bad choice could both add to your stress and your overdraft. Take your time when choosing a builder, talk to friends to see if they have used any trusted builders, check the Federation of Master Builders (http://www.fmb.org.uk/), check references and ask any prospective builders if they have worked with house kits (if you are using one) and ask for examples.
With the best planning in the world, the most diligent research and with a superstar builder, unforeseen problems are bound to occur. They happen to the most experienced developer and the 1st time self-builder. The difference is how you handle these problems. Never budget right up the maximum you can borrow (or the maximum cash you have available). Ideally, keep 10-15% free for these inevitable surprises.