A Beginners Guide For Building.


Many people in the UK regard the concept of building their own home a frightening thought and some even think it is just for the privileged few or just for developers.  However this is not the case.  Most of our European counterparts are not of this impression, particularly the Austrians and the Germans.  America, Australia and Japan are also keen house builders because they do not leave house building to the commercial housebuilding industry to do, they do it themselves.  Therefore they tend to build their dream home whereas most Britons buy someone else's idea of what their dream home is.  So we do not have a choice in the internal layout of the house and the design is restricted to what the builder wants, not you.  Many people tend to redecorate when they move into a new house so that it suits their taste.  However a self builder will be able to incorporate their tastes into the house from the very beginning.



Why Build Your Own Home?


Firstly by building your own home you are cutting out the developer's profit, which depending on location and quality of the build can be between 10% and 30%.  This saving alone can leave you with a smaller mortgage or a much better quality house or building in an area where you always dreamed you would live.  Most self-builders tend to go for a higher specification house, meaning they use better quality tiles, or internal fittings and insulation.  They opt to go for those extra features that we always want such as a swimming pool or sauna.  


The best thing about self building is the tax benefit.  The reason being that when you self build all of the materials and labour are VAT free.  So if you are managing the build yourself you have to pay the VAT initially but within the three months completion of the house you simply send all of the invoices to HM Customs and they refund you all of the VAT amount.  This is usually refunded within the month of receiving them and you do not have to be VAT registered to take advantage of this.  At present you will get 20% cashback on your project, or 17.5% when the VAT drops back to what it was before the recession.  Lots of self builders use this money to perhaps decorate the garden or it could cover a shortfall in the budget, as many self builders tend to go over budget.  VAT can also be claimed back on barns, churches and conversions but not on extensions or renovations, unless the property has been empty for more than 3 years.


An estimated 20,000 to 25,000 self build in the UK every year  and of those 90% to 95% have never built a property before.  The majority of the projects are finished successfully, so it is not so daunting after all.  All backgrounds and all ages decide to self build but the most popular self builders are couples in their 30's and 40's with young families.  The reason being is that they want to leap up the property ladder by two or three rungs and self building is the way to do this.  Also empty nesters tend to self build too, their children have left home and they want to downsize to something smaller and cheaper to look after and so they decide to self build.  What both groups have in common those is the ability to organise, as the self builder has to be organised and in control to self build well.  Many learn this along the way.  


Self Builders represent 25% of the detached house building market and 15% of the house building market as a whole.  Those figures are much higher than any commercial builder.  Therefore it is surprising that only in the last five or ten years have the banks and building societies looked at financing these builds.  Around 40 banks have mortgages for self builders and also big building merchants such as Jewsons and Travis Perkins.  



Finding The Perfect Plot!


This is the first thing to do and one which many find difficult unless you already have land to build on.  Finding a suitable plot of land can take time and effort as the popular areas are normally highly developed or have planning restrictions and those that do come on the market are snapped up by local developers first.  However some plots may not appeal to the developer as they may be too small or not generate enough profit but would be ideal for the self builder.  


Begin looking in estate agents or land websites as these often have one off plots, some also search for plots for you in whatever area you specify but there can be a small fee for this.  


Planning Permission Explained.


There are three types of planning permission.  Outline planning permission is where there is permission in place to build a house although there is only rough details of what the house should look like.  This planning consent lasts five years but you only have three years in which to obtain detailed planning permission giving precise plans of what the development will be.  Detailed planning permission gives you the right to start building your house.  Most people tend to go straight for detailed planning permission as it saves time and again this then lasts for five years.  



Designing Your House.


Normally an architect will design your house and their fees will be between 7% and 10% of your build budget, sometimes one off fees can be negotiated with an architect.  Chartered Surveyors can also be used.  Some companies such as ours will offer you a build package where it is all done for you.  


Most people will then obtain a mortgage to fund the build of their dream home.  Self Build Mortgages are funded on the completion of various stages of the build, this is normally between four and five stages.  Therefore you will need to have funds for the stages before they are then reimbursed by the lender.  


Once the finances are in place you will need to find a single contractor who takes over the whole project or like a lot of self builders do, you will hire many subcontractors.  These will be supervised by yourself so you need to make sure things are getting done properly.  Self Build is all about self control so the more features you put into your house, the more expensive it will be.  Staying in control means that the experience will be a rewarding one.

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