Right to Build

In 2014 the Government announced proposals giving custom builders a right to a plot from local councils.

There began “RIGHT TO BUILD”.  This was designed to help make up the huge housing shortfall and some may say a replacement for Help to Buy which is due to end in 2023.

The Government were concerned that people wanting to build their own homes were finding it difficult to find suitable land.  On 31 October 2016 new legislation came into force. This meant that local councils had to grant planning permission for enough serviced plots to meet demand and they had three years to do so on a so called “Right to Build Register”.  

Self-Build already accounts for some 30% of the new build market and if the scheme takes off then this is sure to rise.

It is likely that the sites will be such that they will allow for single plot purchases on multiple sites which could be for just a couple of houses, or as many as 1,000.

The property must be built for own use/family use (not Buy to Let or second home).  There is no stipulation that the council has to provide a plot to match personal requirements and this may be a stumbling block as a council is only obliged to make plots available to suit demand in their area.

It is thought that around 30,000 people have approached councils for the Right to Build and this could lead to a surge in mortgage demand for bespoke properties often fuelled by watchers of “Grand Designs”. 

The appetite for quirky build types is unlikely to be met by too many of the big players in the mortgage market, who are generally happy to hoover up the standard application which can be fitted into often inflexible criteria.

However, the smaller mortgage providers who cannot compete with the interest rates offered by the large lenders, see this as an opportunity to capture the market for the more unusual builds.

The types of construction that can be acceptable include;

• Timber/Steel Frame
• Brick & Block
• Styrostone
• Becco
• SIPs
• Timber clad

Mortgage providers will usually take an individual view on each proposal and the more detail the better.  Stage payments can be provided, and a key factor will be how much money a self-builder can put into the project from their own resources (that can be family gift).