Build Your Own Home
We’ve all got a dream home tucked away in our minds – that perfect house in the perfect spot – but it really is possible to make that dream a reality.
Building your own home is the perfect way to have the house you’ve always wanted – at a much lower cost than buying a ready-built home. One of the reasons is that stamp duty is paid only on the cost of the land. You could, for example, buy a plot for under £60,000, which is exempt from stamp duty and build a house that could be valued at £500,000 when it’s finished – saving literally thousands of pounds at current levels on the stamp duty you would have had to pay if you’d bought the house ready-built.
Self-builders in the UK have created everything from dream country cottages to state-of-the-art, ultra-modern contemporary homes, and it is a growing market. Archers’ listeners will know that Neil and Susan Carter have become self-builders – and they’re among the 20,000 a year who take the plunge.
Like Neil and Susan, these people aren’t all DIY experts. In most cases the self-builder will not do any building work at all – his or her role is to provide the cash and either manage the project from start to finish or appoint an architect, say, to oversee the management – an excellent idea and worthwhile investment, as it’s a very complex process. Only a very few self-builders will carry out all the building works themselves and only around 20% of all the self-builders in the UK will be involved in any hands-on building.
FINDING A PLOT
Finding land is the first and most important step in any self-build project. Thanks to the Internet, this is much easier than it used to be. The National Building Plot Register is the most comprehensive and up-to-date UK source of self-build opportunities. It covers all of the UK from the far north of Scotland to Cornwall and Northern Ireland. The Register is updated with new plots daily and all plots or conversions are verified every five working days. You can even add an exclusive aerial photo service to allow you to view the plot from your computer, or employ an e-mail alert to go off the minute a new plot goes on the market.
Access to the register can be obtained through PlotSearch, the unique, land-finding service offered by BuildStore at www.buildstore.co.uk. There is a registration charge of around £44. All listings show the type of planning permission given for the land. Buying land without planning permission is a risk as there is no guarantee that it will be given.
One way to minimise planning permission problems is to buy land that already has a house on it that could be demolished before or after your self-build home is complete, although if you are knocking the house down you might be restricted to building on exactly the same spot.
It is possible to obtain further information about a property on the Internet. The Land Registry is now online, and for a fee of £2, providing you have an address or title number you can search a detailed history and ownership of the property that includes information on the land, planning permission and rights of way.
Before you buy land, check out local schools, doctors, hospitals, public transport and the connection of essential services such as gas, electricity, sewage and mains water.
The main difference between a self-build mortgage and an ordinary house-purchase mortgage is that with a self-build mortgage money is released in stages as the build progresses rather than as a single amount. Some lenders will also advance money to buy the land. This is usually 75% of the purchase price or value whichever is the lowest.
There are two methods by which the money can be released during the build – at the end of each stage or at the start of each stage. These are known as arrears stage payments and advance stage payments.
In the arrears stage payment method, the money for that stage is released after the stage has been completed and a valuer has visited the site.
This can cause cash-flow difficulties and may make the build take longer than expected as you wait for the next injection of cash.
The advance stage payment method is more flexible. The money needed for each stage is released at the start before work starts. This advance payment mortgage has become very popular as it gives positive cash flow during the build and as many lenders will advance around 95% of the cost of the build, it may be possible to stay in your old home until the new one is finished as you might not have to sell it to raise cash to start the self-build.
Don’t forget to add in the cost of insurance. You will need cover for the workers on the site, materials and the building.
The good news is that at the end of the project you will be able to claim back a healthy chunk of VAT. The claim must be made within three months of the building being completed. You only get one chance to claim and all receipts etc must be in order, so getting it right first time is a must. You can make a claim for most of the materials used to build the house but not for furniture, carpets, curtains, white goods, trees and plants, burglar alarms, professional services, equipment hire and transport of materials and tools.
HM Customs & Excise publishes VAT Refunds for do-it-yourself builders, dated January 1996 and under Notice 719. This clearly explains who is eligible, how to make a claim and what can be claimed.
You will need an expert to help with proper plans but before you enlist help, list the features you would ideally like to include. Building your own home is the golden opportunity to have exactly what you want. The New Home Plans Book, £17.50 from www.ebuild.co.uk is a useful source of ideas.
You have various choices as to who will help you to design the house and prepare plans. Factors to be considered will include the cost, how involved you would like the expert to be and the style of the house.
Architects offer a range of services from design only to design and build or something in between the two. It is a good idea to see two or three architects so that you can study examples of their work. Personal recommendation from other self-builders is always useful.
The costs of using an architect will vary according to the level of involvement in your project. Negotiate a fee at the beginning and have the fee and what it covers confirmed in writing. Some architects are members of the Royal Institute of British Architects (RIBA) or Royal Institution of Architects in Scotland, but all working in the UK must be registered with the Architects’ Registration Board. Qualified Architectural Technologists (MBIAT) also provide design services.
If you are buying your home in kit form from a timber-frame company you will be able to use the services of the in-house design team. They can provide standard designs from their company’s range of house styles, or adapt these to suit your own personal requirements.
DECIDING ON THE STYLE
The two most popular methods of construction for the self-builder are traditional (brick and block) construction and timber-frame kit.
In traditionally built houses the walls are built in two leaves. There is an internal blockwork wall and an external wall built of brick or stone. These, together with some internal partitions also built of blockwork, will support the structure of the house.
In timber-frame construction the internal structure is a wooden frame designed to support the structure of the house. This frame is clad by a facing material such as brick or stone to give an attractive finish. The market for self-build timber-frame homes is very well organised in the UK and there are many specialist companies who can help with every stage of the build, from design to finishing. Both building methods will provide an attractive home, but the traditional method takes longer to construct and finish as the actual building operation is more time consuming.
SELF-BUILD in SCOTLAND
Before you start building work in Scotland you will need a building warrant. This is granted by the building control officers at the local council. When assessing your application for a warrant, they must apply the standards set by national building regulations.
You need to submit plans to the council which show the location and nature of your proposals and how they relate to any adjoining or existing building. You will also need to supply information about the type of materials and products being used, the size of rooms, the position of appliances and drainage details. Structural design calculations and an energy rating may be required.
A warrant is valid for three years from the date of granting. If you have started but not completed the work within that time you can apply to the local authority for an extension to the warrant period. The application for extension must be made before the expiry of your warrant.
Be warned: you are committing an offence if you start work, without a warrant.
The BuildStore Scottish Self-Build Centre in Livingston, Scotland, is a useful facility for people considering building their own home or who have already started a project. Sponsored by Lloyds TSB Scotland, which provides self-build mortgages for homes in Scotland, and builders’ merchants Jewsons, the centre is the only place in the UK where self-builders can see what goes into the construction of a house and the choices available.
There are more than 20 permanent exhibits, which take you on a visual journey through the self-build process. You’ll see in three-dimensional form the sequence in which a house is constructed and will pick up tips and advice on practical issues such as how foundations and walls are built and what elements go together in roof construction.