Thu 22 Jan 2015 View all news articles

New scheme launched to boost self build in UK

A new scheme that will enable more people to build or customise their own homes in the UK while also helping local authorities with land to develop has been launched.

Designed to de-risk the process of obtaining mortgages for self built and custom built properties, it allows local authorities with land to develop to both attract buyers and retain control over developments until completed.

Based on the existing local authority mortgage scheme, which has already been successfully used by 100 local authorities, the Custom and Self Build Scheme (CSB) has been launched by Capita Asset Services and Lloyds Banking Group.

It will also help local authorities meet the government’s Right to Build agenda. Right to Build will see a ‘vanguard’ of 11 local authorities working with local developers and relaxed planning regulations to create new homes.

‘The Custom and Self Build Scheme tackles a number of issues head on. For those wishing to build their own homes, access to mortgages has always been a challenge because lenders, not unreasonably, insist on staged payments,’ said Cecilie Booth, director at Capita Asset Services.

‘For local authorities, either those leading developments or with land to develop, this scheme reduces risk and guarantees that buyers will have agreed finance in place. Importantly it will help to tackle the need for new homes and according to government estimates, up to 100,000 custom built and self built homes could be created over the next decade,’ she explained.

Under CSB individuals wishing to self build or custom build a home in one of the participating local authority areas will apply for a mortgage and, once agreed, the deposit, for as little as 5% will be paid direct to the local authority.

The local authority will fund the cost of the build to completion at which point, the mortgage will be provided by the lender, covering the build costs, which will be fully repaid to the local authority. Once the house has been built, homeowners will simply have a mortgage on a custom or self built property.

‘Improving the supply of housing across the country is crucial for maintaining a sustainable market, and this scheme will increase the options available for those looking for a new house,’ said Stephen Noakes, mortgage director at Lloyds Banking Group, the first lender to take part in the scheme.

Eamonn Colman, affordable solutions director for Countrywide plc, said that the firm’s full range of property services serve as crucial support mechanisms to help facilitate the building of much needed new build stock.

‘Our national ability to provide land for redevelopment, as well to supply mortgage, conveyancing and surveying services to assist home buyers is an important part in helping more people to achieve their dream of building a new home,’ he pointed out.

‘Exploring innovations such as the Custom and Self Build Scheme that sustainably help to increase supply into the market are crucial in order to help meet current levels of demand,’ he added.

Source: Property Wire

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