Self Build Mortgage - 100% timber house and deposits

[NJLJ2024]

Hi all, 

 

My partner and I are in our early 30s. We have recently been gifted a modest plot of land (100sqm in total) and we are looking at a self build project. We're quickly realising the many things that need to be considered so I'm sure I'll be leaning on the forum's expertise in the coming months! The first thing we are trying to get clear on is finances...

 

I've provided a brief summary of our situation below:

 

• Two story, two bed house - 66 sqm in total (images attached)
• Timber frame, timber clad eco house (though the more we research the more we are getting nervous with the 100% timber approach due to lenders classing this as non-standard construction)
• Partner works for a commercial construction company so there are certain things we will be able to source through them at a cheaper rate e.g foundations. 
• He is also an ex plasterer and has good access to other tradies e.g electrians so should be able to get the costs down here 
• Total costings have so far been calculated by us, and we are estimating around £160k - £180k. There is movement on this figure as there are certain elements we may choose to retain or strip out depending on how the deposit requirements look.
• We have submitted for planning permission with the council and they are in the early stages of reviewing our application 
• We have been advised we should be able to borrow in the region of £450k and realistically we are looking to borrow a maximum of £200k. Mortgage affordability isn't an issue, but depost may be (currently have around £21k saved, but should be able to increase this to around £36k in the next 6 months as we tighten up on budgets). 

 

We were exploring the 5% help to build scheme as this looked attractive based on the low deposit requirements, however reading into this more it seems like this may not be the best route due to the interest rates being applied to the end value of the house once built. I also have a mortgaged flat with around £80k equity in it but in an ideal world I would like to keep the flat and rent it out to give us a nest egg for the future. Would be keen to get others thoughts on this - do you think this is the right approach or will we need to be 'cash rich' to be taking on a self build project? 

 

The norm for deposits seems to be 20-25% but I did come across Chorley Building Society who have a 15% option available. I've made a long list of self build lenders to work through and see if I can find any others - if you're aware of any please let me know as this would be a huge help to us considering our cash position at the moment! 

 

There is still a big question mark over whether or not a timber frame and timber clad house is the right route? I've seen one other post on here with varying opinions and I spoke with Build Store who said their lenders require at least 50% to be another material. However I spoke with Ecology at the Home Show this weekend and they don't seem to think this is would be an issue. My concern is that we limit ourselves to one or two lenders and therefore have access to worse rates/higher deposit requirements which we're keen to avoid! Does anyone have any thoughts or advice on this please? 

 

Apologies in advance if any of this is a stupid question, we're new to this so just finding out feet! 

 

Thank you

 

 

 

 

 

Visuals.pdf

[LiamJones]

Hi, welcome to the forum! I can’t answer your original questions, but can provide some observation of your designs.

 

open plan kitchen onto stairs complicates building regs means of fire escape. Certainly the back? Bedroom, the one without a window, will not meet regs. Possibly only the rooms with sliders/bifolds will meet the requirement. 
 

best of luck with your project! my one piece of advice is download Sketchup and have a play with design yourself, become familiar with he regs. you’ll learn loads and begin to think further ahead. Every job impacts a job a couple of steps down the line! If you trust trades to plan, they’ll only plan their step.

[Iceverge]

Welcome. 

 

A nice project. I'm a fan of small houses. 

 

I like the metal over wood aesthetic but be conscious of how you plan to weather the wood in our damp climate. It might go rather green rather quickly if you don't have a plan. 

 

I would be careful of roof lights in the bedroom. It's ok of you can reach the blinds but invariably they're too high and you'll wake at 5am in summer to a very bright room. 

 

I'm not familiar with your local planning restrictions but at the moment it looks rather more "shed like" than "house like". It might be a factor for consideration and the temperaments of planners. 

 

Over all good luck, nice to see a project kicking off. 

 

 

[PNAmble]

We were also advised to limit timber cladding on our full Timber Frame house., this didn’t impact us really as we are coastal and wanted to avoid timber.  We are with Harpenden arranged via Mayflower brokers who were very helpful.   
 

we are currently finishing off our fibre cement board cladding. 

[Bozza]

Hello.  Welcome.  Your plot (with planning) will have significant value and you own it outright.  Self build lenders can lend against that.  Effectively it becomes the deposit, and they will release the funds you need as and when you need them. Once you have completed just change to a cheaper standard mortgage.   Well thats how I did it, via Ecology Building Society.  Didn’t need a cash deposit.  Search this forum for Ecology many of us have used them with great success.  Ecology are a company who you can phone and get great initial advice, and brilliant to deal with.

 

one issue though is you’d need to evidence the build cost.  Easy for me as I had a turnkey building contract, but you may need a QS report.  Just pick up the phone to them tomorrow to keep you right.

 

that said with mortgage rates as they are - higher still for self builders - you need to consider how long you would have a self build mortgage running if you’re not getting a builder in and doing it yourself.  Might be a year or two and things are only going to get more expensive.  If you sold your flat plus your anticipated savings, that money will get you ah long way on your build without drawing down the SB mortgage.   We sold our previous house and freed up cash to build as much as possible before using the SB mortgage. Self building is stressful, having a shed load of cash in the bank ready to go is good for your wallet and makes things a LOT easier.   Once you’ve completed the build if (big if) you have surplus cash you can always go and get another buy to let flat.

 

just a wee tip.  If you’re going to be buying a lot of materials yourselves, which you will,  make sure you get a credit card with benefits either cash back or airmiles.  Despite having a turnkey contract I did spend £10s thousands myself and earned enough points for a big holiday afterwards.

 

 

[NJLJ2024]

1 hour ago, LiamJones said:

Hi, welcome to the forum! I can’t answer your original questions, but can provide some observation of your designs.

 

open plan kitchen onto stairs complicates building regs means of fire escape. Certainly the back? Bedroom, the one without a window, will not meet regs. Possibly only the rooms with sliders/bifolds will meet the requirement. 
 

best of luck with your project! my one piece of advice is download Sketchup and have a play with design yourself, become familiar with he regs. you’ll learn loads and begin to think further ahead. Every job impacts a job a couple of steps down the line! If you trust trades to plan, they’ll only plan their step.

 

Thank you for the useful tips! We are yet to experience the fun of building regs part of this! 😆 Good point on bedroom without window - will mention this to my partner as he actually did the drawings and will be able to incorporate some changes as we liaise with the council re planning permission. Think we need to have a read up on all the regs to know what to look out for!

 

Edited March 25 by NJLJ2024

[NJLJ2024]

53 minutes ago, Iceverge said:

Welcome. 

 

A nice project. I'm a fan of small houses. 

 

I like the metal over wood aesthetic but be conscious of how you plan to weather the wood in our damp climate. It might go rather green rather quickly if you don't have a plan. 

 

I would be careful of roof lights in the bedroom. It's ok of you can reach the blinds but invariably they're too high and you'll wake at 5am in summer to a very bright room. 

 

I'm not familiar with your local planning restrictions but at the moment it looks rather more "shed like" than "house like". It might be a factor for consideration and the temperaments of planners. 

 

Over all good luck, nice to see a project kicking off. 

 

 

Yes this is a fair point! I need to do my research on what type of cladding would be most resistant to our very cold and wet climate! We are really keen on the aesthetics of the wood finish but equally need to think about the longevity of it - we saw a grand designs that had a very similar look to what we are planning and they used corrugated steel cladding, they did still have a wood like finish on the front of the house - not sure if this was timber or a different material! 
 

Good point on the roof lights also thank you! 

[NJLJ2024]

59 minutes ago, PNAmble said:

We were also advised to limit timber cladding on our full Timber Frame house., this didn’t impact us really as we are coastal and wanted to avoid timber.  We are with Harpenden arranged via Mayflower brokers who were very helpful.   
 

we are currently finishing off our fibre cement board cladding. 

Interesting - fibre cement board cladding was mentioned as an option the other day at the home building and renovating show. We were wondering if this would negate the need for us to put a brick skin under the timber decorative cladding if we decided to still take this route. I assume the lender was satisfied with this and didn’t add it to list of non standard construction?

[NJLJ2024]

45 minutes ago, Bozza said:

Hello.  Welcome.  Your plot (with planning) will have significant value and you own it outright.  Self build lenders can lend against that.  Effectively it becomes the deposit, and they will release the funds you need as and when you need them. Once you have completed just change to a cheaper standard mortgage.   Well thats how I did it, via Ecology Building Society.  Didn’t need a cash deposit.  Search this forum for Ecology many of us have used them with great success.  Ecology are a company who you can phone and get great initial advice, and brilliant to deal with.

 

one issue though is you’d need to evidence the build cost.  Easy for me as I had a turnkey building contract, but you may need a QS report.  Just pick up the phone to them tomorrow to keep you right.

 

that said with mortgage rates as they are - higher still for self builders - you need to consider how long you would have a self build mortgage running if you’re not getting a builder in and doing it yourself.  Might be a year or two and things are only going to get more expensive.  If you sold your flat plus your anticipated savings, that money will get you ah long way on your build without drawing down the SB mortgage.   We sold our previous house and freed up cash to build as much as possible before using the SB mortgage. Self building is stressful, having a shed load of cash in the bank ready to go is good for your wallet and makes things a LOT easier.   Once you’ve completed the build if (big if) you have surplus cash you can always go and get another buy to let flat.

 

just a wee tip.  If you’re going to be buying a lot of materials yourselves, which you will,  make sure you get a credit card with benefits either cash back or airmiles.  Despite having a turnkey contract I did spend £10s thousands myself and earned enough points for a big holiday afterwards.

 

 

Thank you! I did think this originally but I’ve seen that an acre is typically worth £12-£15k and we only have 100sqm which I believe is 0.02 of an acre so if my maths is right the value would be around £300 which doesn’t sound right 🤔 I’ve seen zoopla price per sqm is £1526 so very different calculations neither of which I think sound very accurate! Not sure if you might have a rough idea of what 100sqm may be worth? It’s farmland currently next to his parents house. We plan to get an estate agent to value it as best case scenario it might take away some of our money worries! 
 

Great thank you, I think my partner has got someone to glance over this at work (they deal with this type of stuff for commercial buildings) but I’ll double check with him on this. Assume we will need an official qs to review this so will get it on it. 
 

So we are planning to use a timber frame company to erect the frame and add sips and then another company to install cladding etc. It’s more the internal works that we are trying to do ourselves with the helps of skilled people we know. 
 

I am a little attached to my flat as I’ve lived in it for the last 10 years and it was my first home. Ironically I’ve been stuck here because of the cladding issues but the works are finally coming to any end all these years on! The mortgage is very affordable and with it being in Leeds city centre the rental yield would be good. Need to see what the deposit requirements look like but it’s definitely an option, either that or maybe releasing some equity to get some more cash in the bank for the build!

[Temp]

4 hours ago, NJLJ2024 said:

Thank you! I did think this originally but I’ve seen that an acre is typically worth £12-£15k and we only have 100sqm which I believe is 0.02 of an acre so if my maths is right the value would be around £300 which doesn’t sound right

 

Land without Planning Permission might be £12-15k per acre but with Planning Permission it might be worth anywhere from £150k to >£1m per acre depending on location and what it has permission for. 

 

I would either get drawings done or find photos of a similar size house and see if an estate agent might value the land assuming you can get with Planning Permission for that. If the numbers stack up get proper drawings done for a planning application.

 

Make sure you know about the CIL exemption and what you need to do to get it and keep it before starting any work on site.

Edited March 26 by Temp

[PNAmble]

9 hours ago, NJLJ2024 said:

Interesting - fibre cement board cladding was mentioned as an option the other day at the home building and renovating show. We were wondering if this would negate the need for us to put a brick skin under the timber decorative cladding if we decided to still take this route. I assume the lender was satisfied with this and didn’t add it to list of non standard construction?

 

We don’t have a brick skin at all, the cladding goes down to about 300 above damp proof course and then we’ll have aluminium profiles down.  (These are being done in the next couple of weeks).  
 

The cladding sits in battens and to avoid  paiting we add 100mm EDPM tape over the battens where the shadow gap was.  
 

we are using James Hardie Panels (two different types and colours) via MKM.

 

I’ll find a detail drawing and post a couple of photos of the cladding.

 

the structural warranty guy (protek) has signed off the cladding so not expecting any problems. 
 

the problem we have had is OpenReach won’t connect an overhead cable to the cladding as it’s none standard.  

Edited March 26 by PNAmble

[NJLJ2024]

9 hours ago, Temp said:

 

Land without Planning Permission might be £12-15k per acre but with Planning Permission it might be worth anywhere from £150k to >£1m per acre depending on location and what it has permission for. 

 

I would either get drawings done or find photos of a similar size house and see if an estate agent might value the land assuming you can get with Planning Permission for that. If the numbers stack up get proper drawings done for a planning application.

 

Make sure you know about the CIL exemption and what you need to do to get it and keep it before starting any work on site.

 

Ok, this is super useful to know thanks. 

 

We have all of our drawings already so next job on the list is to find an estate agent that can value it for us. 

 

Hadn't even come across CIL exemptions so thank you for raising - we've added it to our list of stuff to box off!

[NJLJ2024]

4 hours ago, PNAmble said:

 

We don’t have a brick skin at all, the cladding goes down to about 300 above damp proof course and then we’ll have aluminium profiles down.  (These are being done in the next couple of weeks).  
 

The cladding sits in battens and to avoid  paiting we add 100mm EDPM tape over the battens where the shadow gap was.  
 

we are using James Hardie Panels (two different types and colours) via MKM.

 

I’ll find a detail drawing and post a couple of photos of the cladding.

 

the structural warranty guy (protek) has signed off the cladding so not expecting any problems. 
 

the problem we have had is OpenReach won’t connect an overhead cable to the cladding as it’s none standard.  

 

Thank you so much for the in depth view of how you've gone about it - we are leaning towards this as an option so it's great to see some of the things you've done. I've created a whole list of lenders and whittled it down to around 7 with deposits ranging between 5% and 20% that we think meets our needs and seem to have some level of appetite to lend on timber frames with cladding. So next step is to call them up and see what their requirements will be re construction method.

[Bozza]

@NJLJ2024

 

1.  Do research with local planning authority in particular planning policies, and successful local applications.  Other applications will give you idea of what is needed for an application. Visibility sprays, bats drainage etc etc.

2.  Propose to build something that meets policy etc don’t apply to build something odd for area. Use materials / shapes that fit in especially if rural.   If your local planning officers are approachable have a chat with them.  Planning application doesn’t need complex technical drawings more about the appearance of building & materials etc.  liaise with neighbours early on. 

3.  If approved, then value the land.  As other have said it’s value will increase dramatically with PP.

 

All of above is low cost / low risk.

A self building project involves hundreds of stages / decisions.  Break it into manageable chunks.  Above points being the first, important, chunk.  
 

Once / if you get PP then come back to the group if you need help with house design and other stuff eg lender recommendations.  While awaiting PP decision utilise this forum as a self building open university.  Every old post will increase you knowledge of someth8ng you probably didn’t think was a thing to consider.    Stop looking at pictures of fancy bathrooms etc  that comes later.  Good luck.

 

 

 

 

[Alan Ambrose]

Not to mention…

 

Visibility sprays and drainage for bats. 

[ProDave]

On 25/03/2024 at 21:26, Iceverge said:

I would be careful of roof lights in the bedroom. It's ok of you can reach the blinds but invariably they're too high and you'll wake at 5am in summer to a very bright room. 

I would be asking how do you make a roof light a means of escape window?  Perhaps English building regs don't require that?

[Temp]

On 26/03/2024 at 12:39, NJLJ2024 said:

Hadn't even come across CIL exemptions so thank you for raising - we've added it to our list of stuff to box off!

 

See Forms 7 (multiple parts) here..

https://ecab.planningportal.co.uk/uploads/1app/forms/form_1_assumption_of_liability.pdf

The main things to know are..

 

You must still formally claim the exemption using the forms.

The planners may tell you that your planning application is exempt BUT you must still formally claim the exemption using the forms. 

You must not start work on site before sending the forms and getting confirmation they have been processed.  Hassle them for written confirmation.

One form must be sent in after you finish the house/completion.

You must live in the house for three years after completion.

There are other disqualifying events (like renting it out) that can mean you loose the exemption.

 

If you loose the exemption by mistake you get a bill for the whole amount which can be a fortune. 

[PNAmble]

Re CIL some councils don’t apply it , eg Northumberland applies a CMS (coastal mitigation service) cost and no CIL which has to be paid before you start and there is no exemption for self builders.  

[NJLJ2024]

On 26/03/2024 at 22:28, Bozza said:

@NJLJ2024

 

1.  Do research with local planning authority in particular planning policies, and successful local applications.  Other applications will give you idea of what is needed for an application. Visibility sprays, bats drainage etc etc.

2.  Propose to build something that meets policy etc don’t apply to build something odd for area. Use materials / shapes that fit in especially if rural.   If your local planning officers are approachable have a chat with them.  Planning application doesn’t need complex technical drawings more about the appearance of building & materials etc.  liaise with neighbours early on. 

3.  If approved, then value the land.  As other have said it’s value will increase dramatically with PP.

 

All of above is low cost / low risk.

A self building project involves hundreds of stages / decisions.  Break it into manageable chunks.  Above points being the first, important, chunk.  
 

Once / if you get PP then come back to the group if you need help with house design and other stuff eg lender recommendations.  While awaiting PP decision utilise this forum as a self building open university.  Every old post will increase you knowledge of someth8ng you probably didn’t think was a thing to consider.    Stop looking at pictures of fancy bathrooms etc  that comes later.  Good luck.

 

 

 

 

Thanks, we noticed ours is up on the council site now (exciting!) 

 

Partner has been looking at other applications tonight but majority appear to be extensions rather than self builds like ours. 
 

Great shout on looking at the successful ones, we’ll get on this tomorrow thank you. 
 

With it being a rural area our thought process guided us to 100% timber, still such an unknown in terms of who will be willing to lend on that type though. I’ve taken a look at fibre cement board and aesthetically they look similar so well perhaps go this route if the mortgage proves a challenge. 
 

Yes really promising on the land part - we were worried how much this would make a dent in the deposit so it’s nice to know it may be more substantial than we first thought. 
 

Yep I’m regularly reading up on various topics here and learning something new every time!
 

Guilty on the bathroom part 😂

 

[NJLJ2024]

4 hours ago, Temp said:

 

See Forms 7 (multiple parts) here..

https://ecab.planningportal.co.uk/uploads/1app/forms/form_1_assumption_of_liability.pdf

The main things to know are..

 

You must still formally claim the exemption using the forms.

The planners may tell you that your planning application is exempt BUT you must still formally claim the exemption using the forms. 

You must not start work on site before sending the forms and getting confirmation they have been processed.  Hassle them for written confirmation.

One form must be sent in after you finish the house/completion.

You must live in the house for three years after completion.

There are other disqualifying events (like renting it out) that can mean you loose the exemption.

 

If you loose the exemption by mistake you get a bill for the whole amount which can be a fortune. 

Thank you this is really useful! 
 

My partner mentioned that he actually submitted a CIL form as the council asked for it to be completed when we submitted our docs. Will make sure we properly research the process so we’re fully clued up and don’t miss anything! 

[Bozza]

On 27/03/2024 at 22:38, NJLJ2024 said:

 

With it being a rural area our thought process guided us to 100% timber

at least one member here has incorporated steel cladding, to great effect.  Barn style.  Very cost effective.   I built a barn part timber and part steel cladding and it has turned out quite nice.  
 

FYI for building regs you may require to treat timber cladding with a fire resistant coat, if near to a boundary.  If that applies to use test first, as we had to replace an entire elevation because it went wrong.  
 

pinterest is great source for you for ideas. 

[NJLJ2024]

On 30/03/2024 at 09:37, Bozza said:

at least one member here has incorporated steel cladding, to great effect.  Barn style.  Very cost effective.   I built a barn part timber and part steel cladding and it has turned out quite nice.  
 

FYI for building regs you may require to treat timber cladding with a fire resistant coat, if near to a boundary.  If that applies to use test first, as we had to replace an entire elevation because it went wrong.  
 

pinterest is great source for you for ideas. 

That’s useful to know on building regs thank you, I am hoping the timber companies that have quoted will have done this but definitely one for us to check!
 

We saw an episode of grand designs last week and their house shape and design looks very similar to ours. They used corrugated steel cladding with timber at front and it turned out beautifully - image attached.