If you would like to book a consultation with me you can do so here - www.reallifearchitecture.co.uk/online-services Please read the terms and conditions before you book.
We need to overhaul the planning system. Check out the difference in value of agricultural land to building land. Someone has made a political decision to grant planning permission and it’s like winning the lottery! And the same people ( large landowners) are Winning multiple times. I would introduce compulsory purchase ( at a fair agricultural price) then divide it into plots and sell them at cost price. Let’s give others a chance.
I agree the land supply is artificially restricted, there are now too many people invested in the status quo. The least worst outcome is house price stagnation, tracking inflation for decades to come
This is amazingly timely - we're just embarking on a self build. We've purchased the land for cash and are soon to embark on customizing the design of the house plan for the site. We are a retired couple and boy does that make financing even more challanging! No "income" means no stadard mortgage, so only asset based loans are available to us and according to a very experienced self-build mortgage broker these are for 12 months only. Which basically means: sell your current home and rent, put any excess possessions in storage (an added expense for us) - so now we're cash ricjh and homeless while owning a plot of land; build the house (all the time renting); at some point start the loan process to complete the build (needs 2 months lead time, and the build must be complete with certificate of occupancy within 12 months of loan start); move into the house (so no more rent or storage fees anymore); apply for a mortgage to cover amount needed to complete build; pay off mortgage over time to get back to where we were before we started the build. No wonder people don't self-build, the system is not set up to support or encourage that type of build. Anyway, we're brave (silly) enough to give this a try 😅
I’m glad the video helped! Your situation sounds stressful. From your description, the really tough part will be getting the certificate of completion within 12 months. All sorts of things can cause problems and slow that process down. Good luck
I also learned that banks are reluctant to remortgage newly built houses built with timber frame or SIP methotods. And these are the main construction methodes promoted for self builders in the UK.
It is so interesting how how house building works in different countries. In Austria, it is the norm for people to self build. Only in recent years developers buy plots of land and build a number of houses (usually with ridiculously tiny gardens) in the countryside, as there is hardly any land left in urban areas to build on. Maximizing profits, I guess. In Austria "self builder" would mean, somebody who does a lot of work hands on, not somebody who hires an architect and contractor. I don't know how these self builders get their mortgages, but it has worked for decades. Also the planning process and building regulations are so much more straightforward to navigate. Building quality is very high, but they build a lot of ugly houses, so the aesthetic impact seems to get much less consideration.
Bought the land a few years ago with PPiP. Slowly building the cash fund to start, I could do it just now with a self build mortgage but I have seen the heartaches some friends have had. They got there in the end but there was a lot of third party holdups which had a big knock on effect and delays. Still, an eye opening video.
Thank for your comment. I think the general public believe self building is far easier and more common because of Grand Designs. The mortgage broker in the video has only done three self builds in 25 years. It’s incredibly rare.
@@RealLifeArchitecture Aye. I like to watch grand designs for the entertainment value!! My reason for self building is to create a spacious quality home for my family. No extravagant design but economical, practical and efficient. Built with quality materials, fixtures and fittings that will last. Here we go.
We're building a house in northern Ontario Canada on 200 acres and we're dealing with the financing aspect right now. Fortunately northern Ontario has a lot less restrictions than the much more populous southern Ontario. 3 square km per person in our unorganized township means we have extremely limited capacity to impact neighbours or environment. But there's next to nothing in consumer protection. We sold our house in Toronto and bought land up here. We're renting a place too small to fit our family really but it's temporary and considering we've met other families living in RV's, we're living in luxury. We were hoping to build without taking on a mortgage but we'll be offgrid due to no power lines or public water in the area. Plus we need to build half a km of driveway. The battery bank and solar panels are being designed look huge to be adequate for a 5 bedroom house with 2000 sqft and 3 car garage and walk-out basement. It's still a much smaller mortgage than we had in Toronto. Technically it's a builder's loan that the bank has said they're willing to turn into a mortgage at the end. Same as the UK, they release draws in stages. Still, so far, getting blueprints, dealing with the bank and talking to insurance has been pretty smooth and they seem happy to work with us.
Can't you fully cost a house, excluding foundations and landscaping, before you purchase the land? ie have all the full plans and costs ready, with a high end estimate for foundations/drainage that can be reduced depending on the eventual plot. In fact the property would be off grid, so even sewage disposal and energy supply could be fully costed. Can I get a mortgage for that? Surely this is how people get a mortgage for the erection of a kit house? I plan to self build again at some point in the future, but will have the plans and costs available way before I purchase the land which could be anywhere in the UK. I am clueless about mortgages these days.
I’m not sure if the banks are that flexible. According to Pat, the mortgage broker I interviewed, they want detailed costs for everything up front. What I have learned from this is that the system favours cash buyers.
Advice... The only way I can capitalize on the capital that I'm sitting would be to build my own house. Do you think 270k would be enough to build a basic 4 bungalow kit house and buying land in Highlands ????
what about alternative homes, like containers homes for instance. Say you had cash to buy land and get/diy one of these, then get a surveyor or buy a prefab one. Would the planning permission make it also an unaffordable option for a self build also?
My idea if I had, let's say 300k, would be to buy a derelict house for cheap with a mortgage at 10% capital, and then dedicate the remaining 270k cash towards the plans, demolition and build. And then once all of that is done, have it revalued (most likely would be worth waaaay more than the initial derelict), and have the mortgage corrected as per a new market value of the house - would that work?
Why is selling a house that was built 4 years ago so much more complicated (for the lender) than a house that was built 70 years ago? Surely materials have a certain lifespan, I would imagine the risk is greatest at a much older house.
It’s less to do with practical considerations, like the lifespan of materials, and more do to with various pieces of consumer protection legislation in the UK. The builders and designers of a new(ish) hone will still be in business and liability can still be attached to them if something fails within a reasonable timeframe. Therefore the insurance industry has created policies to cover this eventuality and mortgage lenders want to make sure their investments are covered. Basically, it’s all the lawyers fault.
If you would like to book a consultation with me you can do so here - www.reallifearchitecture.co.uk/online-services
Please read the terms and conditions before you book.
We need to overhaul the planning system. Check out the difference in value of agricultural land to building land. Someone has made a political decision to grant planning permission and it’s like winning the lottery! And the same people ( large landowners) are Winning multiple times. I would introduce compulsory purchase ( at a fair agricultural price) then divide it into plots and sell them at cost price. Let’s give others a chance.
I agree the land supply is artificially restricted, there are now too many people invested in the status quo. The least worst outcome is house price stagnation, tracking inflation for decades to come
Thank you. It is very helpful! It looks like self-building is not an affordable alternative for first-time buyers, as some people present it.
True
This is amazingly timely - we're just embarking on a self build. We've purchased the land for cash and are soon to embark on customizing the design of the house plan for the site. We are a retired couple and boy does that make financing even more challanging! No "income" means no stadard mortgage, so only asset based loans are available to us and according to a very experienced self-build mortgage broker these are for 12 months only. Which basically means: sell your current home and rent, put any excess possessions in storage (an added expense for us) - so now we're cash ricjh and homeless while owning a plot of land; build the house (all the time renting); at some point start the loan process to complete the build (needs 2 months lead time, and the build must be complete with certificate of occupancy within 12 months of loan start); move into the house (so no more rent or storage fees anymore); apply for a mortgage to cover amount needed to complete build; pay off mortgage over time to get back to where we were before we started the build. No wonder people don't self-build, the system is not set up to support or encourage that type of build.
Anyway, we're brave (silly) enough to give this a try 😅
I’m glad the video helped! Your situation sounds stressful. From your description, the really tough part will be getting the certificate of completion within 12 months. All sorts of things can cause problems and slow that process down. Good luck
how is your build going please..Can I ask few question?
@@Javiqba unfortunately we've changed builder and architect, so it's not going anywhere currently. Probably get re-started in the autum/fall.
I also learned that banks are reluctant to remortgage newly built houses built with timber frame or SIP methotods. And these are the main construction methodes promoted for self builders in the UK.
Really? Timber frame is almost universal in Scotland. My house, built in 1989, is timber frame. No problem getting a mortgage.
@@RealLifeArchitecture Thank you, Níall! I appreciate your reply. I will double-check it on my site. I probably misunderstood. Kind regards, Slav
It is so interesting how how house building works in different countries. In Austria, it is the norm for people to self build. Only in recent years developers buy plots of land and build a number of houses (usually with ridiculously tiny gardens) in the countryside, as there is hardly any land left in urban areas to build on. Maximizing profits, I guess. In Austria "self builder" would mean, somebody who does a lot of work hands on, not somebody who hires an architect and contractor. I don't know how these self builders get their mortgages, but it has worked for decades. Also the planning process and building regulations are so much more straightforward to navigate. Building quality is very high, but they build a lot of ugly houses, so the aesthetic impact seems to get much less consideration.
Bought the land a few years ago with PPiP. Slowly building the cash fund to start, I could do it just now with a self build mortgage but I have seen the heartaches some friends have had. They got there in the end but there was a lot of third party holdups which had a big knock on effect and delays. Still, an eye opening video.
Thank for your comment. I think the general public believe self building is far easier and more common because of Grand Designs. The mortgage broker in the video has only done three self builds in 25 years. It’s incredibly rare.
@@RealLifeArchitecture Aye. I like to watch grand designs for the entertainment value!! My reason for self building is to create a spacious quality home for my family. No extravagant design but economical, practical and efficient. Built with quality materials, fixtures and fittings that will last. Here we go.
What is PPiP if I may ask?
@@SwahiliSpicEplanning permission in principle
We're building a house in northern Ontario Canada on 200 acres and we're dealing with the financing aspect right now. Fortunately northern Ontario has a lot less restrictions than the much more populous southern Ontario. 3 square km per person in our unorganized township means we have extremely limited capacity to impact neighbours or environment. But there's next to nothing in consumer protection.
We sold our house in Toronto and bought land up here. We're renting a place too small to fit our family really but it's temporary and considering we've met other families living in RV's, we're living in luxury. We were hoping to build without taking on a mortgage but we'll be offgrid due to no power lines or public water in the area. Plus we need to build half a km of driveway. The battery bank and solar panels are being designed look huge to be adequate for a 5 bedroom house with 2000 sqft and 3 car garage and walk-out basement. It's still a much smaller mortgage than we had in Toronto. Technically it's a builder's loan that the bank has said they're willing to turn into a mortgage at the end. Same as the UK, they release draws in stages.
Still, so far, getting blueprints, dealing with the bank and talking to insurance has been pretty smooth and they seem happy to work with us.
Such a good video!! Thank you!
You are welcome
Thanks for highlighting these
No problem
Can't you fully cost a house, excluding foundations and landscaping, before you purchase the land? ie have all the full plans and costs ready, with a high end estimate for foundations/drainage that can be reduced depending on the eventual plot. In fact the property would be off grid, so even sewage disposal and energy supply could be fully costed. Can I get a mortgage for that? Surely this is how people get a mortgage for the erection of a kit house? I plan to self build again at some point in the future, but will have the plans and costs available way before I purchase the land which could be anywhere in the UK. I am clueless about mortgages these days.
I’m not sure if the banks are that flexible. According to Pat, the mortgage broker I interviewed, they want detailed costs for everything up front.
What I have learned from this is that the system favours cash buyers.
Advice... The only way I can capitalize on the capital that I'm sitting would be to build my own house. Do you think 270k would be enough to build a basic 4 bungalow kit house and buying land in Highlands ????
Do you already own the land?
@@RealLifeArchitecture I've not bought any land yet
what about alternative homes, like containers homes for instance. Say you had cash to buy land and get/diy one of these, then get a surveyor or buy a prefab one. Would the planning permission make it also an unaffordable option for a self build also?
This is Interesting
Thank you!
My idea if I had, let's say 300k, would be to buy a derelict house for cheap with a mortgage at 10% capital, and then dedicate the remaining 270k cash towards the plans, demolition and build. And then once all of that is done, have it revalued (most likely would be worth waaaay more than the initial derelict), and have the mortgage corrected as per a new market value of the house - would that work?
Don’t think you can demolish a mortgaged house - probably a clause in your mortgage documentation.
@@sunthroughtheblinds aah, good point! Thanks...
Virtually no lender will give you a mortgage on a house that isn't fit for habitation
Why is selling a house that was built 4 years ago so much more complicated (for the lender) than a house that was built 70 years ago? Surely materials have a certain lifespan, I would imagine the risk is greatest at a much older house.
It’s less to do with practical considerations, like the lifespan of materials, and more do to with various pieces of consumer protection legislation in the UK. The builders and designers of a new(ish) hone will still be in business and liability can still be attached to them if something fails within a reasonable timeframe. Therefore the insurance industry has created policies to cover this eventuality and mortgage lenders want to make sure their investments are covered.
Basically, it’s all the lawyers fault.