If you’d love to build your own home but find the process baffling, then our beginner’s guide will make those pivotal first steps a piece of cake.
As exciting as building your own one-off home sounds, many self-builders are discouraged before they even begin — overwhelmed by what can seem a complicated and stressful process. But this need not be the case. Like any big task, self-build simply needs to be broken down into a series of steps to be tackled one by one. Of course, in a successful self-build, the key steps run concurrently, working together like cogs in a machine to create the finished result — which is where the stress arises. So spend time understanding the process now, start planning and you’ll soon be on your way to getting your project out of the ground. NB: Renovators and converters will find that the process is largely similar.
STEP 1: GET THE FINANCES SORTED OUT
The only certainty in any self-build is that it will begin and end with its budget. So before doing anything else, you need to work out how much you can realistically afford to spend (see below) – on the land and build – then take at least 10% off this sum for a contingency fund.
Next, you need to come up with a rough idea of the sort of house you would like to build. Will it be one or two storeys? How many bedrooms does it need? Will it have a plethora of large, grandiose rooms or be cosy and functional? Building costs are estimated per m2, so the bigger the house, the more it will cost. (A typical four bedroom self-build is around 200m2 — twice the size of an average UK home.)
You’ll also need to decide how heavily you expect to be involved in the build, as the more project managing and DIY you take on, the less (in theory) you will spend.
With our expertise and contacts we can help you budget for your build. While build budgets vary massively – which cost as little as £400/m2 (almost completely DIY) and as much as £3,000/m2 (gold features heavily!) – you can expect to pay around £900-1,100/m2. So, this takes our typical 200m2 house to somewhere between £180,000 and £220,000. Take this off your total budget, and you’ll either be left with an end figure to spend on land — or you’ll need to think about changing your plans.
Finally, make sure it will be worth your while financially. Get an estate agent to value your plans, and establish that there’s still 10-20% ‘sweat equity’ in it for you at the end.
WHERE WILL I LIVE?
If you can afford the mortgage payments, you could stay in your existing home. Otherwise, sell up before you begin plothunting, and rent somewhere. You may be able to live on site in a caravan during the build.
Going over budget is one of the easiest and most stressful mistakes a self-builder can make, so don’t be unrealistic about what you can afford to build — and make sure everyone involved in the project understands your budget. If you do overspend, either cut back on the standard of ‘replaceable’ finishes (i.e. the kitchen or decorating), or take over more of the work yourself.
Once your design is ready, you’ll need to produce a detailed list of materials and prices in order to get accurate quotes. You can use a quantity surveyor to draw up a Bill of Quantities, or you can buy cost-estimating software, to do it yourself.
Self-build mortgages are different to traditional mortgages in that you won’t need all the money upfront. Typically you’ll receive an initial advance to purchase the land and cover the start-up costs, then the rest in four or five stages throughout the project. See buildstore.co.uk/finance for more.
Throughout the project, stay on top of finances. Keep a cash book and write down all quotes and expenditure as it’s made. And file every receipt, as you’ll need them to reclaim the VAT at the end.
HOW MUCH CAN I BORROW
The amount you can borrow is known as loan to value (LTV) — i.e. the percentage of the value of the land and build cost.
A typical LTV is between 75-85%, so the remaining 15-25% will have to be self-funded.
Lenders use income multipliers (i.e. 2.75-3.5 times) or affordability factors.
STEP 2: FIND THE PLOT AND GET A DESIGN
For many self-builders, finding a plot is the most challenging part of the process — and coming up with a design brief the most pleasurable. But while you may be able to perfectly imagine your dream home, you can’t create a design until you land that plot.
You might be lucky and have an existing large garden you can section off, or perhaps you already live on the perfect plot, but in a less-than-ideal house. Otherwise it could take a lot of time, frustration and persistence before you succeed.
Self-builders often complain that the best plots are snapped up by developers, but the competition for these plots is always going to be fierce and self-builders soon learn they don’t have the luxury of no compromises. Ensure you have the finance in place so that when you do find ‘the one’, you can secure it.
Don’t dismiss awkward shapes, steep slopes and small sites, as some of the most breathtaking self-builds were conceived from the ‘worst’ plots. Get a designer to give you an idea of what you could build on it.
Your first consultation with a designer should be free, where they will listen to you and share ideas. After this they will draw up preliminary sketches and consult with you before producing the final plans.
LAND & DESIGN TIPS
To find a plot, join a specialist agency like plotfinder.net. Also try estate agents — visit them regularly and spark their interest by hinting that you may sell the finished house with them. Don’t just look at land: you could knock down an existing house and start again. A lot of plots exchange hands at auctions, so check the listings.
Ensure the plot has ‘full’ and valid planning permission, or else only purchase it subject to approval for your design.
Get a solicitor to check that there are no legal impediments in place, such as a covenant prohibiting building, and commission surveys to check ground conditions.
Choose a designer who understands your lifestyle.
Expect to pay between 3-5% of your build budget to get a design to submit for planning. You can in theory design it yourself using a self-build software package, but if done badly, it will lower the end value. Architects are trained to visualize in 3D and make quality design choices and advise clients accordingly.
Planning permission is a legal prerequisite to building any property.
Your local authority’s planning department makes decisions on applications, and defines the ‘local plan’ for development. Viable plots in the countryside are very rare.
You may be asked to make a one-off payment towards improving the area, called a ‘Section 106 Agreement’.
The current cost of making an application is £335. If turned down, you can appeal.
Note: Self-build is zero-rated for VAT, saving you 20%
STEP 3: CHOOSE YOUR BUILDER
The builder will likely be the major player in your project. Most self-builders hire a main contractor to take on the whole task of project managing — hiring labourers and subcontractors, buying materials and generally running the site day to day. However, if you’d prefer to manage the project yourself (only possible if you can spend time on site every day) or appoint a separate project manager, then that’s fine. You can also take on as much DIY as you wish, perhaps using a builder to a certain point and then finishing the project yourself.
To find a builder, ask other self-builders, your designer or local Building Control officer for recommendations. If a builder belongs to a trade organisation, such as the FMB, that’s a good sign, but don’t trust this alone. Visit homes of past clients and ask them for an honest appraisal. Get in touch with a few builders for quotes, as they probably won’t all get back to you.
TIPS FOR GETTING THE HOUSE BUILT
Once you have planning permission in place, you’ll need to get more detailed drawings done in order to make the house ‘buildable’. Your architect and design team will be able to do this. These drawings will need to be submitted to Building Control.
The Building Regulations are Government-produced documents which set a legal precedent for how a house should be built. Building Control will make site visits at various intervals, to ensure the Regulations are being followed.
If there is a chance you will sell your house within ten years, you must arrange a warranty (such as NHBC), as your purchaser’s lender will require one. This has to be done before starting work on site, which will be inspected in stages.
As soon as you become the legal owner of the plot, you will need to take out insurance to protect against public liability claims, accidents on site, theft and fire etc. Luckily, there are a few specialist self-build policies available.
You’ll need to check the situation with services, especially if you plan to build in a remote location. Connecting to electricity and water, etc. can add thousands to build costs if they’re not close by, so they need to be accounted for early on.
WHICH BUILD SYSTEM IS BEST?
Brick and block is the most common system in the UK — all builders understand it.
Timber frame is made off site and the house can be erected in a matter of weeks.
Oak frame is popular among self-builders for its beauty and craftsmanship, but it is costly.
Structural insulated panels (SIPs) come ready insulated and are prefabricated off site.
WILL IT TAKE LONG?
Typically a self-build takes 18 months to two years from buying the plot to moving in — so it’s a big time commitment.