Have you ever thought about building your own dream property? With UK house prices on the rise, what other options do you have when it comes to property ownership? With thousands of self-build homes completed each year in the UK, we take a look at the things you'll need to consider before embarking on your own self-build project, including planning permission, finding a plot, self-build mortgages and more. Via: http://www.gocompare.com/mortgages/build-your-own-house/

1. BUILD YOUR OWN HOUSE
HAVE YOU EVER THOUGHT ABOUT BUILDING YOUR OWN DREAM PROPERTY?
HERE’S WHAT YOU’LL NEED TO CONSIDER BEFORE EMBARKING ON A SELF-BUILD PROJECT
AROUND 12,000 SELF-BUILD HOMES ARE COMPLETED EACH YEAR IN THE UK
£242,000
AVERAGE HOUSE PRICE IN
THE UK (JUNE 2013)
£150,000
£182,000
AVERAGE COST OF A 1ST
TIME BUYER’S HOME
UP
TO
25%
MIN. YOU WOULD NEED TO BUILD
A 3-4 BEDROOM HOUSE
ADDED VALUE OF YOUR COMPLETED
HOME ON THE OPEN MARKET
STEPS TO BUILDING YOUR OWN HOME
1
SECURING A MORTGAGE
25%
YOU WILL LIKELY NEED A
HIGHER DEPOSIT FOR A
SELF-BUILD MORTGAGE,
OFTEN AT LEAST 25% OF
THE TOTAL COST
DEPOSIT
75%
MORTGAGE
THINK ABOUT INCLUDING
A 10% EMERGENCY FUND
IN YOUR BUDGET
2
MONEY IS USUALLY RELEASED IN
5-7 STAGES, AND YOUR LENDER
MAY ALSO ARRANGE INSPECTIONS
IN BETWEEN PAYMENTS
10%
CONTINGENCY
THIS MAKES SELF-BUILD MORTGAGES
MORE EXPENSIVE, BUT THINK ABOUT
REMORTGAGING AFTER YOUR HOME IS
COMPLETE TO GET A BETTER DEAL
FINDING LAND
PLOTS CAN SOMETIMES BE DIFFICULT TO FIND, BUT IT’S WORTH DOING THIS
BEFORE DESIGNING THE LAYOUT OF YOUR HOME
CAN’T FIND A PLOT? CONSIDER KNOCKING
DOWN AN OLD PROPERTY AND STARTING AGAIN
IF YOU DO FIND A PLOT YOU LIKE, CHECK THAT THE LAND ISN’T:
?
IN A FLOOD PLAIN
UNDER A FLIGHT PATH
CLOSE TO A RAIL LINE
NEAR A BUSY ROAD
CLOSE TO OTHER PLANNED
DEVELOPMENTS
BEFORE BUYING A PLOT, CONSIDER GETTING YOUR PLANNING PERMISSION APPROVED FIRST
STAMP DUTY LAND TAX (SDLT)
FOR SELF-BUILD PROPERTIES, SDLT IS ONLY APPLICABLE ON THE COST OF THE LAND
AND NOT THE VALUE OF THE COMPLETED HOUSE
LAND COST
SDLT RATE
£125,001 £250,000
£250,001 £500,000
3%
1%
£125,000
LAND COST
ZERO%
UP TO
3
FREE FOR UP TO £125,000!
SDLT RATE
£500,001 £1,000,000
4%
YOUR FLOOR PLAN
START DESIGNING THE LAYOUT OF YOUR PERFECT HOME
HOW MANY BEDROOMS? BATHROOMS? ENSUITE?
TRY TO BE SPECIFIC IN YOUR DESIGNS, BUT FLEXIBLE IN HOW THEY ARE
IMPLEMENTED TO HELP KEEP YOUR COSTS DOWN AND WITHIN BUDGET
4
PLANNING PERMISSION
THERE ARE TWO DIFFERENT TYPES OF APPLICATIONS:
OUTLINE
PLANNING
PERMISSION
THIS CHECKS WHETHER YOUR
PROPOSED PROPERTY WOULD BE
ACCEPTABLE TO YOUR LOCAL
AUTHORITY, AND IS USUALLY VALID
FOR 3 YEARS
THIS IS A DETAILED APPLICATION
FOR YOUR PROPERTY WHICH
YOU WILL NEED TO HAVE
APPROVED BEFORE ANY
BUILDING WORK CAN START
FULL/DETAILED
PLANNING
PERMISSION
THE COST OF BOTH APPLICATIONS VARY DEPENDING ON YOUR LOCATION, BUT IS IN THE REGION OF £320 - £385
NOTE:
5
PLANNING PERMISSION IS A KEY STEP IN YOUR SELF-BUILD, BUT IT IS NOT ALWAYS STRAIGHTFORWARD - THERE ARE
NO GUARANTEES THAT YOUR PLANS WILL BE APPROVED AND THE APPLICATION CAN SOMETIMES BE TIME CONSUMING
ARCHITECT OR KIT HOUSE?
“I WILL HELP YOU TO STAY COMPLIANT WITH BUILDING REGULATIONS, TELL YOU WHAT’S AFFORDABLE FOR
YOUR BUDGET, AND ADD IN UNIQUE CHARACTERISTICS TO YOUR BUILD. IF YOU LIKE, I CAN ALSO HELP YOU WITH
APPLYING FOR PLANNING PERMISSION AND MANAGE THE ENTIRE PROJECT FOR YOU FROM START TO FINISH.”
“I’M ALSO KNOWN AS A PREFABRICATED HOUSE - IF YOU’RE NOT CONCERNED ABOUT HAVING UNIQUE
ARCHITECTURAL FEATURES TO YOUR HOME, I WILL HELP YOU TO KEEP YOUR COSTS DOWN.
ALTHOUGH I MAY BE LIMITED ON DESIGN, I’M QUICK TO CONSTRUCT AND YOU WON’T NEED AN ARCHITECT JUST THINK OF ME LIKE A FLAT PACK HOME.”
6
FINDING YOUR TEAM
CHOOSE YOUR TRADESMEN CAREFULLY!
ASK FOR THE PRICE OF THE WHOLE JOB BUT NEVER PAY THE FULL
AMOUNT UP FRONT - PAY IN INSTALMENTS TO MAKE SURE YOU’RE HAPPY
WITH THE BUILD
THE CHEAPEST QUOTE MIGHT NOT BE THE BEST - CHECK REVIEWS &
RECOMMENDATIONS
YOU COULD SAVE MONEY BY SOURCING MATERIALS YOURSELF - YOUR BUILDER
MIGHT BE TIED TO A STORE BUT YOU CAN SHOP AROUND FOR THE BEST DEAL
COULD YOU TAKE ON SOME OF THE TASKS YOURSELF, SUCH AS
PLASTERING, PAINTING AND DECORATING?
7
INSURANCE
8
START THE BUILD
YOU MAY NEED TO TAKE OUT SPECIALISED INSURANCE TO PROTECT ANYONE WORKING ON YOUR
BUILDING SITE - SPEAK TO AN INDEPENDENT FINANCIAL ADVISOR OR AN INSURANCE BROKER ABOUT THIS
NOW THAT YOU HAVE EVERYTHING IN PLACE, YOU CAN START THE BUILD!
YOU WILL LIKELY FACE A FEW MORE OBSTACLES ALONG THE WAY THAT ARE UNIQUE TO YOUR PROPERTY, BUT DON’T WORRY, AS YOUR 10%
CONTINGENCY BUDGET SHOULD COVER THESE ISSUES
9
RECLAIM YOUR VAT
LASTLY, DON’T FORGET TO RECLAIM THE VAT ON YOUR PURCHASES
MATERIALS SOURCED FOR YOUR SELF-BUILD PROJECT ARE EXEMPT FROM VAT TAX, AND COULD
SAVE YOU A GOOD SUM OF MONEY AT THE END, SO DON’T FORGET TO CLAIM THIS BACK!
10
ENJOY YOUR NEW HOME!
SOURCES:
4HOMES, MONEY.CO.UK, THE INDEPENDENT, THE TELEGRAPH, ONS, THISISMONEY.CO.UK
FINANCIAL TIMES, THE GUARDIAN, PLANNINGPORTAL.GOV.UK