1. ‘Land with prospects’ – a ‘prime site’ at a bargain price?

Land without planning permission isn’t a plot, it’s a field – at best a ‘potential building plot’.

Never buy land before it has planning consent. You can agree to buy land but only pay for the site once permission’s been granted.

Options are used by developers to secure the ‘right to buy’ land at a future date.

In return for payment, the landowner grants the developer an ‘option’ to buy the plot within an agreed time period, if the developer can get PP.

If successful, the developer buys the land at an agreed discount to cover the risk and cost of getting PP.

A bargain plot?

But…..

- why hasn’t it been built on before?

- is it serviced?

- is there a history of pollution?

- is there access?

May be OK if sale price reflects the cost of putting it right + risk & hassle - check the planning status – and when PP expires.

Essential to check date Planning Permission was granted - and when it’s due to expire (normally PP expires if construction doesn’t commence within 3 years of being granted).

Where PP has expired you may assume that, having granted consent before, the Planners will renew it?

In fact, there’s no guarantee that they’ll grant PP a second time, especially where there’s been a change of policy in the meantime.

 

2... Skipping Pre-Purchase SITE CHECKS

Sites with dramatic landscapes usually rejected by developers.

Sites with irregular shapes or significant changes in levels will need a land survey.

Once you have an accurate survey drawing of the site, you know exactly what you’re buying.

You will also know if there are any hidden ‘nasties’!

The main drawback of buying at auction is that you have to pay for up-front investigations - all the site surveys, checks and legal work - in advance.
Unless you win, the money is wasted.

But only paying for the minimum up-front checks increases the chance of buying a site with hidden problems.

Plots sold at auction can be tricky to value, with odd shapes or with hidden problems that may have caused previous sales to collapse.

Although the conveyancing process is similar to buying a house, buying land for development is a specialist area.

It’s worth paying more for a fast service, to help beat others after the same plot.

This can make the difference between success and failure.

If possible appoint a solicitor recommended by other self-builders.

 

3. Cut Price CONVEYANCERS

Pick a solicitor with experience of land purchases – so they can:-

- recognise when an obscure problem can be solved, eg with an indemnity policy

- familiar with local Councils’ procedures

- don’t miss something (e.g. ransom strip, adverse possession)

Who owns a piece of land?

‘Squatter’s rights’ - Title can be acquired by ‘adverse possession’ where someone has occupied the land – e.g. living in a caravan on the site, or cultivating the land or even fencing part of it off.  As well as the 3 major costs - the land, materials and labour - don’t forget to include all the ‘hidden’ costs you’ll need money to pay for:-

- Professional fees – architects, engineers, surveyors

- LA Planning & Building Control fees

- Insurances

- Warranties

- Finance and Mortgage fees

- VAT paid out (before being reclaimed at the end)

- Payments for new service supplies for water/drainage/electric/gas etc

- Contingency fund

- Moving home fees and furnishings

Cost analysis

• Drawings need to be translated into a list of materials and labour (Quantity Surveyor).

• Tempting to skip this and leave it for the builders to work out.

• But keeping control of costs is important.

• Self-builders often pay an estimating company to print-out a list of quantities of labour and materials with estimated costs.

 

4. OVER-OPTIMISTIC BUDGETING OPTIMISTIC BUDGETING

If you want a job done well, do it yourself‘.

DIY can mean substantial savings cutting out labour costs and a main contractor’s profit margin.

BUT consider this…

- Time: It can take 2 or 3 times longer to complete the build doing a lot of work yourself (especially if new skills have to be learned). Good compromise = have outer shell built by contractor, and leave the rest as a DIY self-build project.

- Materials: Builders Merchants may be reluctant to offer the same discounts available to long-term customers.

- Design: If you take pure DIY route, design the build for ease of construction - as simple as possible – using materials that don’t demand very high skill levels. e.g. straightforward roof shapes.

 

5... Saving Money with FULL DIY SELF BUILD.

Key Questions

What work can I do myself?

• It helps if you’ve already got good experience such as building an extension.

• Some self-builders tackle below ground construction works - setting out, ground preparation, laying concrete foundations, and laying the brick and blockwork up to DPC.

Stick to the day job?

• Be realistic about how much time you can commit holding down a day job whilst trying to run a building project.

• Maybe better to earn more money in your job and employ a professional on site?

Slotting in

• Problems can be created where a relatively slow DIYer is buggering about, causing delays to following tradesmen. By losing a ‘slot’ it could take weeks before a trade can get back to you.

Consider how you’re going to keep up with the programme.

• Many self-builders take on the decorator’s role towards the end when there’s less time pressure.

• Or behind the scenes, keeping the site tidy – sweeping up, clear paths, make sure stacks of bricks are stable – so your site runs smoothly.

Can you hack it?

• Staring at a computer screen all day doesn’t build stamina, so don’t expect to compete with people who’ve worked on building sites.

Once you own that plot of land, you’re suddenly responsible for pretty much everything that happens.

No matter how well you run your site, unexpected events can happen.

There are 3 types of insurance that self-builders need (included in special self-build policies)

* Employer’s Liability insurance covers you for accidents to employees, eg should one of the trades you employ have an accident, and claim against you.

* Public Liability insurance covers you should your building work damage / injure a third party, e.g:-
- friends or family lending a hand or your architect falls down a hole in the ground. Also covers injury to trespassers!

* Contractors’ All Risks insurance covers you for site risks, e.g. theft, and damage caused by vandalism, fire, flood, storm etc.

But if you personally get injured (if you were incapacitated, work on site would probably stop for many weeks).
So you also need insurance for personal accident, death, and permanent injury.

6... Skimping on INSURANCE

Go for recommendations preferably from other self-builders – and do your homework!

Don’t automatically pick the lowest quote or tender.

Beware picking the cheapest price from a builder who can start tomorrow.

One builder may have undercut the others because he made a mistake.

If you accept an uneconomic price, it will be you who loses out in the end, when they fail to finish or go bust.

An unscrupulous firm will later charge you premium prices for extras. It’s often better to go for the middle ground.

Why is one quote / tender so cheap? Maybe they forgot to include some materials or labour?

It may be cheaper in the long run to select another, rather than risk skimping on materials and labour to recoup losses - ending up with a badly done job or having to pay for lots of extras.

 

7. Picking the CHEAPEST BUILDERS

Don’t try to save money employing ‘friends of friends’ & migrant labour.

Getting ‘a friend of a friend’ to do electrics or plastering etc can backfire.

With informal arrangements you can find yourself left in the lurch - because something else has come up at the weekend when they promised to finish your job.

And if a key piece of work hasn’t been done, the following trades will be held up.

Employing non-English-speaking trades invites communication problems.

A Bulgarian roofer may have a different way of working that doesn’t take account of UK Building Regs.

Plus there is a tendency for illegal migrant workers to grab their tools and leg it out the back door as soon as the Building Control Officer makes an appearance!

 

8... Not paying for a PROFESSIONAL DESIGNER

One big attraction of Self Build is freedom to create a stylish home of real quality.

A well designed modern building, that’s different from the surrounding architecture, can complement the character of its surroundings.

Steeper sites not popular with developers - as more expensive (landscaping, drainage, special foundations).

But this can be an opportunity requiring creative flair. Saving money with DIY drawings … can harm your chances of approval. It’s tempting to save money producing drawings on your PC.
But if they look amateurish, it could be a false economy.

Unattractive or unclear drawings will not persuade the planners in the way that a set of well-drawn professionally produced plans can.

A photo mock up or 3D model can positively illustrate your design.

Planning committees comprise local councillors who may be ‘plan blind’.

Once consent’s granted, everything written on the approved drawings legally forms part of the permission.

So if you’ve written ‘natural Welsh slate’ on your drawings, but later you can only afford cheaper artificial slate, the planners will need to approve the change.

Many disputes are due to misunderstandings about what work was meant to be done for the quoted price.

Trying to save money by not preparing a detailed specification is a false economy.

Sets of drawings can leave gaps. Only a detailed specification will clearly list each component of the job so it can be individually priced.

(Some info will already be on your Building Regs drawings, but these only include stuff relevant to LABC).

It also helps you focus on exactly what you want early on, reducing the risk of misunderstandings later.

 

9... Skipping the PAPERWORK,

Design detail.

Important to think carefully in advance about the details - light switches, sockets, taps, rads, basins etc - or the builders may fit ones left over from the last job.
Being lazy and skipping all the research means trouble later - misunderstanding on site over tiny details can grow into disputes.

If you’re not using a standard contract you can instead write to the contractor to formally accept his offer.

This ‘letter of acceptance’ is a legally binding contract document and should include:-

- a list of the drawings and documents on which he based his quote,

- confirmation of the agreed price (the ‘contract sum’),

- the agreed start and completion dates,

- stages of payment etc.

You must also request that the builder formally acknowledges receipt of your letter.

 

10. Saying ‘sod it’ to SAP RATINGS

A ‘Design SAP’ calculation is required to prove that your house will meet energy efficiency targets.

Some LABCs won’t approve plans until they’ve received a satisfactory ‘Design SAP’.

Others don’t insist on a SAP assessment up-front – in which case don’t just forget about. Or they may demand costly changes at completion, even requiring parts of the house to be re-built, before they can issue the ‘compliance report’ and completion certificate.

Currently, majority of designs fail at the first attempt to meet the required standards.

The SAP assessor will advise how the design can be modified (e.g. thicker insulation or more efficient heating system, or adding a secondary heating source, such as a log stove).

Cheap workmanship = air gaps = delayed ‘As Built’ SAP = delayed completion certificate.

What if your builders leave out some insulation or substitute cheaper materials? A final ‘as built’ SAP calculation will be done on the finished house - an ‘On Completion EPC’.
The compliance report can be filled out at completion once your air test results and commissioning certificates are available.

11. Building Regs Shortcuts

Two options for submitting your Building Regs application. Full Plans or Building Notice.

Building Notice – you’re making a promise up front that you will comply with the Building Regs on site, rather than submitting detailed drawings to prove it in advance.
But a site inspection could uncover something that doesn’t comply during the build - requiring a lot of extra work to expose and re-build - highly disruptive & expensive.

Penalties - LABC have considerable powers to halt and condemn work.
They can force you to re-build the works so that they comply. If you refuse, BC can employ other builders to do the work and send you the bill.
Contravention = prosecution / fine or prison.

Skipping the Full Plans process doesn’t always save much time, as you may still be asked to provide drawings and structural calculations.

With both routes, once your application has been accepted, you can start work on site (min. 2 day’s notice).

About 50% of Self Build projects risk commencing work on site before Full Plans approval has been granted.

Once they’ve checked your engineer’s calculations and no major concerns raised about the early stages of construction, it should be safe to start.

Speeding up the process.

One possible time-saving option - submit your Building Regs app before PP is granted, so the two overlap.

But – if planners requested changes, you’ll also need to amend.
Building Regs drawings = delay and extra cost.

12... Saving £££s with BARGAIN MATERIALS

You can sometimes make big savings going direct to a foreign supplier.

BUT risks and hidden costs can cancel out much of the savings…

- The language barrier - communicating a technically complex specification in Polish?

- Do the materials meet British Standards and comply with Building Regs?

- Cost of long-distance deliveries, import taxes and a weak pound?

- What if they’re poor quality – is there a guarantee? Who will pay for the cost of returning the goods?

Goods offered cheap, may be of poor quality or may be stolen.
If you unknowingly buy stolen goods, the legal ownership of those goods does NOT pass to you - they can be legally reclaimed by the original owner.

False economy to specify a cheaper boiler, underpowered boiler - allow for future expansion.

Cheap materials, eg doors, can detract from value of house. Cheap felt flat roofs have a short lifespan.

Materials specified by designer to meet B.Regs.

If the drawings specify concrete blocks of the correct strength (e.g. 7 N), density (e.g.2000kg/m3) and thermal efficiency (e.g. 0.15W/mK) to support loadings and meet energy targets, you can’t for example just use any old concrete blocks left over from last job!

Wastage

False economy to order too few materials - better order too many and have some left over than for work to be held up because you’re a few tiles short.
Reclaimed materials often have a higher wastage factor - you may need to over-order by up to 20% on second hand bricks, slates and tiles compared to around 5% for new.

13. DELAYING PAYMENT to trades

Careful management of your cashflow avoids the scenario of a stop-start project - where work stops due to lack of funds, and funds stop because there’s no works being done.

An ‘advance-payment’ mortgage can greatly help by getting funds into your bank account in good time.
Also, make the most of interest-free credit at Builders Merchants.

BUT… always pay trades and contractors promptly – especially towards the end of the job when builders are most financially vulnerable.
No one is going to do their best work if they’re not paid on time. Plus this is an easy way to create a positive atmosphere.

 

14... Cutting back on PROJECT MANAGEMENT

One thing is certain about any construction project – at some point things will go wrong, no matter how well managed your site is.

Organisational skills are often something that self-builders can contribute. But the PM role is time-consuming:-

- co-ordinating labour & materials & funding, site safety, security, payments, quality control, CDM, liaising with LABC etc.

Project Managers are the unsung heroes who prevent problems arising in the first place - preventing someone getting hurt on site saves stress & expense of legal claims or criminal charges

Where Self-Builders live on site as a family = a potentially lethal mix with children, pets combined with bricks dropped from scaffolding and holes in the ground.

Theft

Site must be secured with (hired) steel fencing. Loss of certain goods at key stages can serious disrupt your build programme, especially custom-made items.
Site insurance is essential.

Building sites are renowned for serious accidents. If injury or death occurs on your site, criminal law could apply and you could be held personally responsible.

If you are employing more than 5 people on your site at any one time, the Management of Health & Safety at Work Regulations 1999 apply.
You must be able to demonstrate that you’ve taken reasonable precautions to prevent injury, e.g:-

Keep a few hard hats on site, + luminous vests, goggles and masks in your ‘site office’.
Provide a First Aid box and accident register.
Scaffolding only to be erected by qualified firms with insurance cover.
Half of all construction fatalities are due to falls, hence the ‘working at height regulations’ which, amongst other things,
restricts the use of ladders.

 

15. UNAUTHORISED DEVELOPMENT

Graham Head spent 6 years constructing a 3 bed bungalow under an open barn camouflaged by straw bales.

To avoid getting planning permission, he kept the home near Dorking hidden for 4 years so the council would have to approve it - even though it was on green belt land and in an AOONB.

Should the Planners fail to challenge unauthorised development within 4 years, it can become immune from enforcement. The owner can then apply for a Certificate of Lawful Use or Development which grants retrospective PP.

Unfortunately…..neighbours and walkers became suspicious and contacted the local council. In 2004 he applied for a 'certificate of lawfulness' application based on the claim that he had lived in the completed bungalow for 4 years.

The Council rejected the application and ordered the building to be demolished because its construction had never been given planning permission.

Farmer Graham’s appeal was dismissed after a public inquiry in 2005.

During the long-running dispute, Mr Head's wife grew tired of the continuous sneaking around and this led to their break-up.

Farmer who built secret castle behind straw bales loses court bid to save it from demolition.

Robert Fidler secretly constructed a Tudor castle-style property without planning permission hidden behind 40ft straw bales and a tarpaulin.
Planning officials refused Mr Fidler's appeal, saying the building works only finished when the straw bales were removed - so the 4 year rule did not apply.
At appeal, the High Court judge upheld the order to have the house - which was built on the site of two grain silos - torn down.
The bales had to be considered part of the 'totality' of the building.

Asked why he had built the home, Mr Fidler replied: 'They say an Englishman is entitled to have his castle. I thought that maybe I could claim this to be my castle and see if there was any mileage in that.'

 

Ian Rock MRICS,
Zennor Consultants,
Kiln House,
Duck Lane,
Ludgershall,
Aylesbury,
Bucks
HP18 9XZ
Tel: 01844 238866
Fax: 01844 238788
Email info@zennorconsultants.co.uk

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