“A self-built home is £150,000 average, including the land.”
Grant Shapps, 14 May 2012
The background
Britain’s housing crisis shows no sign of easing off, and with demand for new properties outrunning supply, the Housing Minister is now suggesting we do the building ourselves.
Grant Shapps has issued a flurry of press releases and statements in recent weeks calling on more Britons to consider donning the hard hats themselves, in a campaign designed to double the size of the self-build sector.
Around 14,000 new homes were self-built last year, which is fewer than in most developed countries but more than some housebuilding firms are managing at the moment.
It’s not just for millionaires – that’s essentially the message from Mr Shapps, who has teamed up with TV property show stars in a bid to boost the self-build industry.
Central to this campaign is the claim – repeated in several variations – that “a budget of £150,000 is adequate, in most instances, to get a three-to-four-bedroom home built”.
Can that really be true?
The analysis
Mr Shapps has helped launch a new website, The Self Build Portal, for people thinking about building their own homes.
The site features a handy budget calculator that enables us to put Mr Shapps’s sums to the test using current cost estimates from industry professionals.
At first glance, he seems to be on the money with the £150,000 budget projection.
Construction costs for a “generous 3-4 bedroom house” range from £108,800 in Northern Ireland to £188,000 in London, with the average coming in at £154,866.
That’s based on contractors doing most of the work. You could do it cheaper, taking on about 60 per cent of the work yourself.
If you do that, you reduce the average cost to £99,000 and change.
But of course if you did most of the work yourself you would probably have to take months off work and rent accommodation while your dream home took shape.
All these things would take a toll on your wallet, not to mention your marriage, sanity etc.
One of the case studies on selfbuildportal.org.uk saw a couple living in a caravan for seven years while building themselves a wooden house in Wales, which FactCheck for one wouldn’t fancy much.
But – and it’s a big but – construction costs alone aren’t the whole story.
These figures miss out the cost of actually buying the land you are going to build on in the first place, a fairly serious omission.
Land costs vary massively across the UK, from an average of £50,000 in Northern Ireland to a whopping £430,000 in London for a standard 1/15th-hectare sized plot.
Unless you’ve inherited land, these costs naturally need to be tacked on to the construction total to get the full cost of building your own home.
The verdict
Taking land costs into account, the average cost of a three-to-four-bed self-built house rises to £158,800 in Northern Ireland to £618,000 in London. Across the UK the average is £281,116.
If we accept that it’s just too expensive to build in London and leave the capital out of our calculations we get a final average of £250,490 – more realistic but still well above the £232,000 average cost of a ready-made house, according to the government’s own figures.
Mr Shapps’s statement in a blog this week that “a self-built home is £150,000 average, including the land” is patently untrue. In fairness, other recent statements he’s made on the subject haven’t mentioned the “including the land” bit.
Perhaps that was just a slip – but either way he’s still not being entirely straight about the real cost of self-build.
Far be it from us to put people off from making their grand designs into reality, but it seems reasonable to expect the government to tell prospective self-builders the whole story before asking them to sign up to such a huge financial commitment.
By Patrick Worrall
