Self Build Mortgages
On the 1 April 2016 a new piece of government legislation came into effect which makes it easier for those interested in building their own home to find suitable land.
The Selfbuild and Custom Housebuilding Act, dubbed the ‘right to build’ by media, means that local councils are now obligated to offer suitable, serviced plots to those who are interested in acquiring land on which to build their own home. Councils are also required to keep a register of these individuals and groups of people.
Anyone wanting to undertake a custom build project can register their interest with their local council or via the Local Self Build Register website. The council will then offer them a number of suitable council owned plots and can also put them in touch with local landowners who have land to sell, via the register.
In the past, self builders faced barriers including finding and access to suitable land and development funding, and challenges in navigating regulations in the development process, such as acquiring the necessary planning permissions.
The Act, championed by the National Custom and Self Build Association (NaCSBA), removes these obstacles through obligating councils to offer plots of land. There is also the promise of fasttrack planning processes and planning permission ‘in principle’ for some sites, which will greatly reduce timelines and the hoops that self builders have previously had to jump through.
What can I do to get a self build mortgage?
For those looking to build their own home, there are a number of self build mortgages on the market. Depending on the lender, there will be different terms and conditions, so it is important to do your research to find out what sort of self build mortgage is best for you.
Things to consider include:
- The stages at which funds are released
- Whether funds released in advance or arrears of each stage
- If the lender allows borrowing on the value of the land as well as the build
- Will the lender release finds for the purchase of land
- If you should seek out a specialist mortgage broker with expertise in this field