It seems that the affluent "eco worriers" are helping the self build market boom. Programmes such as Grand Designs have had an impact on the self build market which is witnessing the luxury end of the self build market growing faster than ever before. It seems that the Waitrose generation, who are being classed as the well off eco worriers, are looking for their dream plot so that they can build their dream home.
Typically it is 20% to 30% cheaper to build your home rather than buy it ready-made, this creates a premium once the house is completed. Sometimes the premium is a lot higher than the self builder originally thought. One such example is Warwick Raymen who runs a glazing firm. He bought 12 acres of land in Croydon, Cambridgeshire so that he could build an eco-friendly farm house. The cost of the land was £590,000 and the cost to build the house was around £300,000. However the end value of the farmhouse is an astonishing £1.25million which is an uplift of 40% more than the entire cost.
A self builder also pays less tax because if you buy a home you have to pay stamp duty on the value of the house. However if you build one then you only pay the duty on the value of the land if the land cost more than £125,000. If the land cost you less than £125,000 then you do not pay anything. In terms of the building materials that you use throughout the build, you can also claim the VAT back on them.
For some of these self builders money is no object especially if their plot involves demolishing an existing house to build again. Because there are a shortage of premium plots, especially in places like London, buying an existing house only to demolish it and start again is becoming increasingly popular. However doing it this way is not really eco-friendly. Other options are previously commercial or light industrial sites as you can find these sites in residential areas such as London. The only hurdle is getting the local planning authority to change the use of the site.
Mortgage companies are lending to self builders. Property developers may be finding it harder in this economic climate but if you are building the house as a family home then you can get finance. Some facts around the self build market are:-
£220,000 is the average cost of a self build project in the UK, so your eco-friendly home may be within your reach and is not just for the really rich.
In the coming few years the self build market is expected to double in size.
There are more than 20,000 homes built every year in the UK as self build projects.
Fiona Davies is sales director at Eco Friendly Homes Company.
She has worked in the property and land sector for the last fifteen years.