What is the Help to Build scheme?

We all need a helping hand when it comes to financing a self-build project and the government’s Help to Build Equity Loan scheme could be the answer. You may have questions like: How can I finance my self-build? What support is available for self-builders or how much deposit do I need for a self-build?

The scheme was released as part of the government’s Comprehensive Spending Review back in late November 2020.

A £2.2 billion fund will be introduced to support house builders, including self-builders, which incorporates the Help to Build scheme alongside funding for small and medium house builders and Modern Methods of Construction.

The National Custom and Self Build Association (NaCSBA) has been working hard to create a Help to Build Equity Loan scheme to emulate the existing Help to Buy Equity Loan scheme. They will be working with the Ministry of House, Communities and Local Government to help shape the scheme. This scheme will help self-builders get finance to help build their own homes.

The key change is that the loan is paid to the mortgage lender on practical completion of the self-build rather than to the builder on the legal completion of the sale of the new build.

The NaCSBA outline how the scheme works on its website: “The mortgage lender will provide funding for self-builders up to 95% of the costs of the build. This will enable the self-builder to proceed with just a 5% deposit (as with Help to Buy). Then, in line with Help to Buy, when the build is completed the government provide 20% of the cost of the property.”

NaCSBA’s online YouGov research revealed 1 in 3 British adults were interested in self building at some point, with 59 per cent of respondents saying that access to finance remained the biggest barrier to self and custom building.

A Help to Build scheme would support more people to build their own homes who would otherwise struggle to find the finances. Details are yet to be released in regards to the format or the timescale of the Help to Build scheme.

Andrew Baddeley-Chappell, NaCSBA CEO, said: “We hope to see the new Help to Build scheme up and running as soon as possible together with the additional wonderful, affordable sustainable, uplifting new homes that it will help deliver.”

Alongside the Help to Build scheme, the UK government is reviewing its Right to Build laws – more welcome news for wannabe self and custom builders. This review will examine how councils are supporting self and custom builders to ensure there is enough land to help them get their foot on the housing ladder. Discover more about how the Government's Right to Build review could help more people build their own home here. 

Finance Planning