Many of us dream of building our own homes. Yet, while it’s a common aspiration in the UK, we’re far less likely to self-build here than in other countries across Europe.
Self-build accounts for between 7% and 10% of all new housing across the country, around 12,000 homes per year, according to a House of Commons briefing paper. By contrast, that figure is 80% in Austria.
Yet a 2011 survey by the Building Societies Association found that more than half of Britons (53%) would consider self-build if the opportunity was available to them. As such, the government has encouraged self-build in recent years, hoping to boost housing supply.
There are both rewards and risks with self-build houses. What is a dream can soon turn into a nightmare as cost and complexity derail self-build projects. Here are the major pros and cons of self-build:
Because you’re building your own home (or more likely, paying someone else to do the actual work), you’re involved at every stage of the process.
That means you can tailor the design and finish to all of your specific wants and needs. For example, you can build a super-green home that’s so energy efficient you don’t get any electricity bills. Self-build homes are bespoke, so you can get exactly what you want from a property.
Often when buying a home you’ll need to compromise on the plot. The building may be what you had in mind, but it’s not in the greatest setting.
But when you’re self-building, you’re buying the land as well. So you can choose a plot that meets your desires, such as overlooking the sea, or in a remote rural location.
In theory, and often in practice, self-build can be cheaper than buying a ready-made home. The cost of land plus construction can, with research and careful planning, come in lower than the resulting property’s market value.
So not only would it be cheaper than buying a similar property that’s already there, but you could make some money off of the end product, too. What’s more, you can claim back VAT on the construction.
There’s always the risk that things go wrong or that you weren’t stringent enough in your planning beforehand.
Budgets can quickly spin out of control as unforeseen problems arise during construction and if you’re relying on a mortgage, the money will usually be released in stages, which can create cash flow problems that delay and disrupt the project.
You need to be sure that you have enough money saved up to see the self-build project through to the end because otherwise you’ll end up living in an empty shell of a property with no utilities.
Another risk is that you might make the property a little too bespoke, meaning it’s so unique that the resale market is small, affecting your chance of reselling the house if you ever wanted to.
Self-build is not for the faint-hearted. These projects can take months, sometimes even years, before the home is finished. That requires a lot of patience, especially if you’re having to rent in awkward or uncomfortable accommodation while work takes place.
You’ll also need a cool head if things go wrong. Moreover, you need to be an excellent project manager, or hire a good one, which is hard if you’re having to work a full-time job alongside overseeing the construction.
No building project is ever straightforward. In truth, self-build is highly stressful. There’s a lot of money — and your home — at stake. Do you have the mettle for it?
Source: Yahoo Finance UK