Self-build for low earners gets industry thumbs up
Self-builders will be exempt from section 106 tariffs to cut down the costs of building, councils will have to establish the demand for self build in their areas and create a waiting list of self-builders for brownfield sites which become available and the grant funding for self-build and community-led affordable housing will be provided.
Foster said: “For many people the concept of building your own home means one thing: a fantasy mansion built by people with deep pockets and endless spare time.
“We are determined to end this misconception so anyone with aspirations to build their own home has the opportunity to do so including people on low incomes.”
Raymond Connor, chief executive of BuildStore Financial Services, a provider of self-build finance, said: “This is another welcome package from the government especially as it is aimed at opening the self-build market up to more households.
“We know that there is a lot of pent up demand for people wanting to build their own homes so these measures will help to meet that demand particularly at a time when there is a shortage of new homes.”
Traditionally lenders have been reluctant to give self-builders a mortgage before the house is built and valued so the government has been speaking to lenders about doing more for self-builders.
To date 26 lenders are now offering self-build loans and gross self-build lending is predicted to increase by almost half between 2012 and 2015 to £1.9bn a year.
Connor said he has already seen signs of improvement in the market with the number of new self-build mortgage applications up over a quarter on this time last year with expectations that this will grow faster over the next 12 months.
He said: “The backlog of unsold plots are now finding buyers and those who owned already owned land but held off during the recession are now also coming forward looking to borrow the cash to build.”
A review of the Homes and Communities Agency’s large number of smaller plots will identify those which are not viable for large-scale house building but are perfect for small housing projects like self-build.
More property asset data will be published online and the community right to reclaim land will be enhanced so self-builders can request that redundant public sector land is released and sold for self-build projects.
Over 50 councils are already bringing forward sites and offering assistance to self-builders and many developers are exploring the self-build business model with over 3,000 individual plots in the pipeline across various projects in England.