Self-Build Mortgages  Other Considerations

Self Build Mortgages

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Considerations

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As the main purpose of creating a self-build property is to design a home that will be either a dream home or, alternatively, a house that is easy to sell and which produces a healthy profit, design is crucial. Although having the freedom to design your own property offers great scope for creating a perfect house, this does leave an investor with a whole host of decisions that would not normally have to be made.

Certain key design rules should be adhered to when building a property solely for profit. It is absolutely vital that the design remains in keeping with the target market and that one's personal preferences are put to one side. Trying to cram too many features into the property can also be a big mistake; clean and simple lines and features tend to work best for a new build and often expensive additions such as high tech television and sound systems are unlikely to increase the value of the property.

When considering every addition, focus on exactly how much this extra is going to cost you and how it is likely to affect the final asking price; never get carried away. Building a property is not about cutting corners, but it is about making sound financial decisions and only spending money on worthwhile improvements and desirable features.

Insurance
Building a property is certainly not without risk. Insurance requirements will vary as the build develops and keeping on top of your needs will not only save you cash on unnecessary insurances but it will also ensure that you have the correct level of coverage. When you are purchasing a plot, your insurance requirements are relatively small and should cover the basic flood or fire risks. But, as the property is being built, insurance needs will change.

During the build itself, it is important to ensure that you have suitable insurance in case anyone working on your site is injured. If you employ a project manager and a main contractor, it is likely that they will provide their own insurance. Do not, however, leave this to chance; make sure that there is no comeback on you if there is a problem.

It is also important to keep the structure insured, as it is being built; this may require regular changes to the policy. As a general rule, deal with the issue of insurance every time you discuss a stage payment with your financial institution. Remember to alter the level of insurance cover whenever a new stage is completed.

Re-Sale of the Property
If your intention is to sell the property, at the end of the build, then make sure that you keep extremely clear and detailed records of all work completed and the various insurances and guarantees involved. Any buyer will be keen to see that all works have been completed to full specifications and may ask to see the plans as well as the relevant planning permission and regulations. By keeping these documents to hand, you are increasing your chance of achieving the maximum possible resale value.

Summary
Bullet Point Creating a self-build is not simply about finding the correct plot; design is fundamental;
Bullet Point keep in mind the market that you are targeting and resist the temptation to indulge your own design preferences;
Bullet Point make sure that you have the appropriate insurance at EVERY stage of the build; and
Bullet Point document everything!

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