Across much of the developed world, building your own home is far from unusual. In fact, self- and custom-build account for around 40% of new homes internationally, and in countries such as Austria the figure rises to well over half.
In the UK, however, the picture looks very different. Self- and custom-build projects account for only around 7% of new homes, highlighting the significant untapped potential in this part of the market.
At a time when the UK continues to grapple with housing shortages and buyers are increasingly exploring alternative routes onto the property ladder, self- and custom-build should arguably be playing a far larger role. The opportunity is clear, but the challenge lies in unlocking it.
WHY THE UK IS FALLING BEHIND
The first barrier is awareness. For many borrowers, the idea of building their own home still feels unrealistic. Television programmes such as Grand Designs have helped spark interest, but they have also reinforced the perception that self-build is reserved for ambitious, high-budget projects.
In reality, the market is far broader than that. Self-build does not always mean starting with a blank plot and constructing a property from the ground up. It can include major renovations, conversions such as transforming a barn into a home, or purchasing a property in need of significant work and redeveloping it entirely.
Many borrowers simply do not realise that these routes fall under the umbrella of self- and custom-build. As a result, they default to purchasing from a large developer, even when other options may be available to them.
Planning is the second major obstacle. The UK planning system can make it difficult for individuals to access suitable plots or navigate the process of building their own home. While local authorities have responsibilities to support self- and custom-build through measures such as the Right to Build register and other planning policies, delivery remains inconsistent.
This is important because land availability is often viewed as the core issue. In reality, less than 1% of the UK’s land is used for housing development. The challenge is not simply the physical availability of land, but the difficulty of navigating planning processes and unlocking viable plots.
WHY SELF- AND CUSTOM-BUILD MATTER
If these barriers can be addressed, the benefits of self- and custom-build are considerable.
Energy efficiency is one of the key drivers behind many projects. When homeowners are involved from the outset, they can incorporate modern construction methods, improved insulation and efficient heating systems into the design. The result is often a property that is significantly more energy efficient and cost-effective to run over the long term.
There are also wider benefits for local economies. Self-build projects frequently rely on local contractors and locally sourced materials, helping to keep investment within the surrounding area.
Interestingly, these developments can also attract stronger community support. Large-scale housing schemes often face resistance, particularly where they are perceived to impose uniform designs on existing neighbourhoods. Self- and custom-build homes tend to be more varied and individually designed, which can help them sit more comfortably within local surroundings.
From a homeowner’s perspective, building a property can also create value earlier in the ownership journey. Rather than purchasing a finished home developed by someone else, borrowers can capture the value created through the development process itself.
THE ROLE BROKERS AND LENDERS CAN PLAY
For the self- and custom-build market to expand, brokers will play a crucial role.
Intermediaries are often the first point of contact for borrowers exploring their homeownership options. Simply recognising that self- and custom-build can be viable routes opens up new conversations with clients who may otherwise assume they have limited choices.
For brokers, this represents an opportunity to support clients whose circumstances may not align with a standard purchase. But it begins with visibility. If self- and custom-build are not part of the conversation – or even referenced on a broker’s website – borrowers are unlikely to realise that advice is available.
Lenders have a responsibility here too. At Saffron, we place significant emphasis on education and awareness, providing brokers with resources and guidance to help them understand how self-build finance works and how best to approach these conversations with clients.
Self- and custom-build will not be the right solution for every borrower. But for many buyers, it represents a genuine opportunity to create a home that meets their needs while contributing to housing supply in a more flexible and locally driven way.
If awareness can be improved, access simplified and brokers supported in navigating the market, self- and custom-build could move from being a niche part of the sector to a far more meaningful contributor to the UK’s housing future.
