Self Build for Beginners – FAQ – Part 1
At the beginning of the year, Allan was invited to take part in the ‘Self Build for Beginners’ Q&A session at the Ask the Experts Virtual Event hosted by Laura Crombie from Homebuilding & Renovating Magazine.
The event was really successful and Allan received lots of interesting questions from people who were interested in building their dream home. In this mini Self Build for Beginners FAQ series, we will share with you answers to the questions asked at the Q&A session with Allan.
List of the Self Build for Beginners FAQ questions:
– How much of the existing house do I need to knock down for it to be considered as a new build and therefore to get VAT back? If it is ground level what if your house is on a slope?
– Once planning consent has been granted, can I then make small tweaks for instance, adding some skylights to a flat roof? Once I’m at building rake stage?
– What is the conveyancing process when you’re buying a plot? So how does it differ from just buying a property? And where can you find details of plots that are for sale?
– I bought some land, that is one of many plots that were available, what can I do to make sure planning permission is accepted and successful?
– What would be your one piece of advice when looking for a plot that is going to make a successful home in the future?
– At what point in the process should I get an architect involved?
HOW MUCH OF AN EXISTING HOUSE DO I NEED TO KNOCK DOWN FOR IT TO BE CONSIDERED AS A NEW BUILD AND THEREFORE TO GET VAT BACK? IF IT IS GROUND LEVEL WHAT IF YOUR HOUSE IS ON A SLOPE?
The simple answer is below DPC. We have had this checked and clarified recently on a project that we’re doing where the client is keeping the existing foundations, but because it’s being built on a slope, they’ve managed to get confirmation from HMRC that what they’re doing will still classify as a new build and therefore be zero VAT rated. And it’s really important, if it’s anything other than simple and clean, and by the book for the guidance, then check with HMRC. There is a claim department that you can go through and ask questions. It may take a little bit of time for them to get back to you but there is a specific department that deals with it. If you do an internet search for ‘VAT reclaim for new build’, you’ll get directed to the right page on HMRC.
So usually, we advise to be anything below DPC, but I would probably put that back on you and say well, actually, is there anything worth saving? Because if you’re going with the existing foundations, you might then be fixed on the design and the layout of the house. So yes, you might have foundations that are suitable, but you might be limiting your choices in terms of design. I would also always get a structural engineer out to check the foundations. If you’re going to try and keep them to save a bit of money, make sure you get an engineer to come out and expose the foundations and do some calculations to check that they actually can take the new method of construction. That depends when they were built, and whether they were pre 50s/60s that might just not be able to take modern methods of construction or might not be suitable. So, get them checked by structural engineer and if you’re in any doubt about the HMRC zero VAT rated claim, speak to directly to HMRC.
ONCE PLANNING CONSENT HAS BEEN GRANTED, CAN I THEN MAKE SMALL TWEAKS FOR INSTANCE, ADDING SOME SKYLIGHTS TO A FLAT ROOF, ONCE I’M AT BUILDING REGS STAGE?
There are processes in the Scottish, English and Welsh planning system for non-material variations or minor material variations ie. changes that wouldn’t have been material to them giving the planning application in the first place. Skylights and rooflights are usually ok, because you’re not usually creating an overlooking issue. You’re actually making a benefit by bringing more sunlight and daylight into the building.
But the key things are that you don’t just make the change with your builder on site, you speak to your architect and structural engineer, and then they can make a judgement call to make sure that it’s going to be covered under one of the variation clauses within the planning. It’s usually just a simple variation application for non-material or a minor material variation that can be dealt with. As long as it’s not creating an overlooking issue or any other issues that the planners may have classed as material to getting the approval in the first place. So, if they’ve actually said ‘no, you can’t have this’ and then you want to go back and change it, that might be an issue. So, normally it shouldn’t be a problem, but speak to your architect and get the relevant variation to the conditions application submitted.
WHAT IS THE CONVEYANCING PROCESS WHEN YOU’RE BUYING A PLOT? SO HOW DOES IT DIFFER FROM JUST BUYING A PROPERTY AND WHERE CAN YOU FIND DETAILS OF PLOTS THAT ARE FOR SALE?
There’s a couple of different websites: Plot Search and Plot Finder are the two main ones that people go to. If you’re looking for a plot, we always get our clients to register with all of the estate agents locally in the areas that they are interested in and tell them that you’re looking for a development plot. A lot of people buy bungalows to demolish or old buildings that can be converted or demolished. We’ve also had clients that were thinking a bit more out of the box and they would go and knock on doors, they would ask people if they’ve got a bit of land that they want to sell or they put out flyers to say that are looking for land and give their contact details. That’s another way of finding land. That’s the first part.
Once a plot has a planning approval, it’s mortgageable. So as long as it’s got full planning, you can then get a mortgage and pay for the land purchase through a mortgage. There are lots of good deals out there. Most of our clients go through BuildStore, they are the biggest players in the market that will help you with mortgage advice. There are also other companies. Do a bit of research and decide who you’re going to speak to.
In terms of the conveyancing site, it’s best to speak to a professional and it won’t be any of the high street lenders. It’s usually some of the more bespoke companies that deal with a self build mortgage. It is because you will need payment structures at different times to facilitate the stages of your build and cashflow is really important in the purchase. You may have a pot of money sitting and you may think that the best thing to do is to buy the land with that, but you may actually need that to pay for some of the initial stages of your build. It’s really important because most of the mortgage products are arrears. So you need to think about your cashflow, the total amount that you’ve got to build, and speak to the right people and get the right advice. As I said, there are products out there that will lend on the purchase of the plot as well, so that makes a big difference.
I BOUGHT SOME LAND, THAT IS ONE OF MANY PLOTS THAT WERE AVAILABLE, WHAT CAN I DO TO MAKE SURE PLANNING PERMISSION IS ACCEPTED AND SUCCESSFUL?
Without having more information about this plot, I would assume that it has at least outline planning permission. If that’s the case, the seller has most likely dealt with the access and some part of the infrastructure as part of the outline planning application. You’ll then have to submit a reserved matters application to discharge the design, the look, the landscaping, all these different parts of the build.
So, the first thing I would do is get a copy of the outline planning permission. You can download that from the planning portal from your local planning authority. It’s also really important not just to look at the approval, but to look at the delegated report. It is something that people tend to miss when they’re looking at things, but the delegated report is where the planners and all the consultees put all of the relevant information into that approval. Then that gets distilled down into the actual planning approval. It’s really useful for getting history and background information on why and how it could be approved. Once you have got that information, speak to an architect.
We, as a practice, do free initial consultations and free site review services. A potential client would come to us with the planning reference number and then we would then have a 40-minute Zoom call with them, or a meeting in-person when we’re allowed to do that, and we would go through all the pros and cons.
You should have access to information about the original existing planning when you purchase the site, and if the outline planning is there, it means the principle has been established. Then it is all down to the local design guides and you designing something that is what you want and can afford, and that is going to get a chance of getting planning approval.
WHAT WOULD BE YOUR ONE PIECE OF ADVICE WHEN LOOKING FOR A PLOT THAT IS GOING TO MAKE A SUCCESSFUL HOME IN THE FUTURE?
There are two crucial things I would like to mention here as a lot of self-builders make mistakes here. First thing is to check the ground conditions before you buy a plot. To do this you will need to get a soil investigation study done. You cannot accurately work out what your budget is going to be without knowing the ground conditions. It could be anything between £500-1500 to get a soil investigation study done by an engineer. They’ll check the bearing capacity of the ground which will then work out what your foundation design is going to be. That might not seem overly complex or important to some people if you’ve not done it before, but the difference between a traditional strip foundation and a pile foundation for the same house could cost £50,000 difference. So, before you’ve even started the project, buying something that’s got difficult ground conditions could mean that your budget won’t work.
The second thing is the cost of connections. If you’re buying a plot in the middle of nowhere that isn’t properly serviced ie. Hasn’t got electricity to it, you could be looking at anything from £2500 to the worst we have had was £125,000 for an electricity connection to the grid. That plot wasn’t that far away from a telegraph pole that had power on it, but the whole network had to be upgraded and you pay for the network and the transformer to be upgraded to get your capacity.
Those are two things that could really cause you problems to start with, and that are vitally important. People often miss them and they’re easy to fix. On the grid connection, you just do a search for who provides the new connections in your local area. They’ll have a new enquiry section and you just ask for a single-phase supply, give them a site plan, and they’ll give you a cost.