Response to the DCLG select committee’s report on ‘Capacity in the homebuilding industry’

In response to the recent publication of the DCLG select committee’s report on the ability of the housebuilding sector to meet demand for new homes, The Homebuilding & Renovating Show is lending its support to The National Custom and Self-Build Association (NaCSBA)’s call for additional proactive involvement by the Government and local authorities in making custom and self-build more accessible and affordable.

Michael Holmes, spokesperson for The Homebuilding & Renovating Show and chair of the National Custom & Self Build Association (NaCSBA), says:

“We welcome the report’s call for more action on growing the custom and self-build market. The Homebuilding & Renovating Show and NaCSBA’s stance on this has been consistently highlighted during NaCSBA’s representations to Government and to the DCLG select committee, and the report released today positively reflects our position. Custom and self-build has the potential to deliver 40-50,000 new homes a year in England by 2030, extending choice, affordability, sustainability and diversity of supply. But this will only happen with continued government support to establish owner commissioned housing as a mainstream alternative model of delivery.

“The Capacity report sets out the main challenges faced by potential self- and custom builders, which are much bigger than those experienced by small and medium sized builders. For example, if you can’t afford a significant deposit, you are probably excluded from the custom and self-build sector. Another significant development is that the Committee is requesting an update on solutions for accessing finance within 12 months.

“In response to the Committee’s question on funding, the sector would like to see the extension of the Help to Buy Equity Loan Scheme to include custom build homes. This would offer a 20 per cent equity loan from Government (40 per cent in London) to help people to build their own individual home through custom build. This scheme has already successfully boosted the sale of new homes by volume housebuilders by reducing the deposit required to buy a home to just five per cent. Those wanting to buy a custom build home find they need a minimum of £30-40k to be able to put down the deposit on a serviced plot, commission a design and commence building, using a stage payment self build mortgage. Help to Buy for custom build would open up the market to a whole new audience of hardworking people who can afford a mortgage but don’t have the deposit required to custom build and get the benefit of choice of design and specification.

“Accessing land is also a challenge for custom and self-builders. The figures released by NaCSBA can provide evidence of unmet demand for people who want to custom or self-build. It highlights that in other developed countries, around half of the homes built are custom or self-build, and that 53 per cent of the UK population would like to build or commission their own home at some time in their lives (14 per cent / 7 million people in the next 12 months) but only around 10,000 succeed. Around 10 per cent of this market want to do the full ‘Grand Designs’ self-build approach. Around 12 per cent are happy with the minimal choice offered by a speculative volume house builder. The remaining 78 per cent of prospective new home buyers are not catered for in the UK currently.

“Since 31 October 2016, when the Right to Build legislation came into force, local planning authorities are required to keep a register of people (find your local authority register via who would like to have a custom built home and they are meant to identify land to meet this demand. This means that within the next three years, local authorities in England are responsible for granting planning permission for sufficient shovel ready plots to meet the demand gathered by the Right to Build Registers. This will also be supported by the soon to be launched Right to Build Task Force given support in the Government White Paper ‘Fixing Our Broken Housing Market’ which will assist local authorities and community led housing groups bring forward land for custom and self-build homes by providing expert advice, with an emphasis on the delivery of more affordable homes.

“The annual Homebuilding & Renovating Shows are also supporting and raising awareness of this legal duty within the Housing and Planning Act 2016. Visitors who are at the start of their property ventures will be advised by experts on their legal rights and guided on how to find and apply for a plot of land, a step which will influence significantly the pace of their projects.”