Self Build Homes are bucking trends
17/05/2005
The recent signs in the housing market are that it is set for a further slowdown. But one part of that market appears to be bucking the trend.
First-quarter figures from BuildStore, supplier of finance, materials and advice to people who want to build their own homes, show mortgage applications rose almost 70 per cent to £178 million.
And while the West Lothian company arranged £300m of mortgages for self-builders in the last financial year, the projections for 2005 are for a record £500m.
Founder and managing director Raymond Connor says: "Our first-quarter figures this year show a healthy growth pattern and highlight a major shift to people building their own homes."
The company also helps out with the purchasing of materials. It has agreements with major building supply firms and prospective builders can obtain a trade card from BuildStore to buy materials at a discount.
Sales in the trade card are again up significantly, at £3.5m in the first quarter of the year, 30 per cent more than a year earlier.
BuildStore was established five years ago with four staff. It now employs 90, based at the Scottish Self-Build and Renovation Centre in Livingston. Early next year, it is to open a second centre in Swindon. And there are plans for a further centre, possibly in Sheffield.
BuildStore has arranged loans for more than 7000 self-build customers throughout the UK. In Scotland, the average size of the loan has been about £100,000, with the average house price coming in at around £140,000.
Mr Connor says most people have seen a suitable piece of land and want details of how to develop it. "But a lot of people get in touch because they are not sure how to go about self-build," he adds.
Self-build is one of the few ways open to house-buyers to afford the type of property they want.
The company estimates that people should be able to secure land and work with advisers to build their home at something like 30 per cent less than purchasing a ready-built home.
Some self-builders have become mortgage-free within five years, through a process of building and selling, taking advantage of the equity build-up each time.
"Five years from now, building your own home could be an even more substantial share of the market and a particularly attractive option for first-time buyers," says Mr Connor.
He wants to further develop the market for self-build by entering into agreements with local authorities to increase the amount of property that will be available.
And he confirms that a shared equity scheme for self-build has been agreed with a major lender.
- The Scotsman
