What is Custom Build?

Tim Doherty looks at what the goverment's custom build scheme means for you
by Tim Doherty
21st February 2013

Throughout Build It and in the related industry you’ll hear the term ‘custom build’ used a great deal. But what does the phrases actually mean, and how does it differ from traditional self-build?

For decades the term ‘self-build’ has embodied all of the forms used to procure your own new home, regardless of your level of involvement.

What makes a self-builder?

At one end of the spectrum are those with both practical skills and technical knowledge who intend to play a very significant part in the physical build. At the other end are those who intend only to commission, choose and specify their new home.

What they all have in common is that, somewhere along the way, these ‘self-builders’ have all acquired a plot of land upon which they intend to have their house built. But it’s rare for genuine development opportunities to come to market in bulk.

This is where self-building in the UK differs from other models across Europe and the rest of the world. In most other developed nations the notion of buying some land and building your own home is just one of a range of normal options and, crucially, open to entrants at all levels.

But things are changing in the UK for the better. It may not feel like it yet, and we may all still be reeling from the effects of recession, but as a result of a sustained campaign by many from this sector, we now have a government that is, for the first time in my 30 year career, actually striving to encourage more self-build.

Introducing custom build

The government first included the term ‘custom build’ in its 2011 Housing Strategy paper for England, entitled Laying the Foundations. It’s used as a catch-all phrase for those wishing to commission or build their own home.

This includes traditional self-builders who will get deeply involved on site; the self-procurers who will orchestrate the management of their projects; and the self-commissioners who will link to their project only through their professional teams.

Building on the principles of localism, the government is hoping to shape an environment where custom build can become a mainstream option for the provision of new housing in the areas that need it the most.

The phrase ‘custom build’ is then perhaps best understood as a sector label for the growth in generic self-build on a scale not previously seen here in the UK. But who else needs to be involved alongside this newly empowered community?

Other stakeholders

Landowners are key and need to be encouraged to consider allocating plots for custom build purposes.

The Homes & Communities Agency (HCA) has already made some sites available for custom build projects and, increasingly, developers and housing associations are now looking into the possibility of dedicated sites for individuals to play an active part.

Indeed, the 2012 Planning Policy Framework expressly makes provision for local councils to measure demand for custom build in their boroughs.

But, if this is to represent self-build ‘at scale’, we also need developers to allocate their sites accordingly and provide infrastructure, drainage and services to each individual plot.

Alternatively, and by the formation of appropriate groups, individuals could come together as a collective where the appointment of contractors for roads, services and drains is just seen as an enabling phase of a larger development.

Encouragement from the government means there are now multiple options on how custom build can be structured and the prognosis looks good for self-build’s expansion.

Finance & lending

Just as vital as land is the need for development funding and the provision of traditional and new lending to facilitate growth.

Contrary to the opinions of some commentators, my experience of lenders has been wholly positive. Constructive support for this sector has seen the emergence of many bespoke mortgage products.

From a lending perspective, the challenges faced by one individual self-build project will be totally different to the various profiles of new custom build sites where 10, 20 or even 100 houses are all being individually constructed – or where a group of 30 eventual residents are all collectively involved in a large attached, terraced or multi-storey block.

It’s going to take a little time for these project profiles to become properly understood and for responsible and accountable management models to be properly determined, such that lenders feel comfortable with their exposure.

It’s a great opportunity, however, and lenders, just like all of the other stakeholders, won’t want to miss out.

Future of self-build

The scaling of self-build into a custom build sector is good news for us all. Such is the demand for new housing in the UK, our existing national housebuilders won’t have their supply interrupted, and both channels should happily co-exist.

Once we have seen the delivery of really good quality custom build multi-development sites, with expressive architecture and satisfied occupants, it will only serve to increase the quality and diversity of all new housing, regardless of channel.

My guess is that custom build, in all its forms, will help to solve our affordability crisis, and over the next five years we will increasingly see this as a way for new entrants to get onto the housing ladder.

Main image: This custom build scheme, re-purposing a stoneworks to provide affordable local housing, was funded by the HCA

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