Dream of Building your Own Home?
If you have ever dreamed of building your own home but thought it was impossible to obtain the finance? KDW Commercial can help!
TV shows such as Grand Designs have definitely piqued the attention of the public and tapped into the desire that many of us share - of building our dream home.
So just why is the notion of building our own homes so appealing to many of us?
Kevin McCloud, the creator of Grand Designs, has encouraged people to build a home which suits their lifestyle instead of ordering a generic home from a developers catalogue.*
It can be a lot cheaper to add certain luxuries to your home while it is being built, such as underfloor heating or eco-friendly fixtures.
In theory, the cost of constructing a home will be a lot cheaper than it’s a market price. However, this will be dependent on the management of the development; as costs can spiral out of control if not properly managed.
You can get exactly what you want. If you have always dreamt of having a large kitchen with an island or a cellar then you can have it (cost permitting)!
So why doesn’t everybody build their own home?
It can be difficult to find a plot of land and obtain planning permission. Especially as so many people are looking to buy a pot of land for the same purpose.
While many people dream of building their own home, they tend to focus on the finished product and are put off by the all the hard work involved in getting the project off the ground.
People can be discouraged from investigating further because they believe it will be impossible for them to obtain the finance needed for the project. However, this isn’t the case – KDW Commercial can help.
Building your own home with KDW Commercial
At KDW Commercial, we have the knowledge and expertise to source you the most competitive self-build finance solutions. We’ve worked with many developers so understand the demands and constraints that come along with a self-build project. We also have key industry contacts which we can introduce to clients who are beginning their first ever development.
Here is an overview of some of the finance solutions available to us:
- Loan amounts can be as high as 65% of the Gross Development Value.
- Funds can be lent in stages, to fit in with different stages of your development. This also means that interest is only payable on the amounts which have been drawn.
- Arrangement fees can be incorporated into the loan amount.
- There are a few different repayment options available including capital repayment and interest only. Although some people chose to have the interest added to the total loan amount so that it is payable on completion of the project.
- The term of the mortgages can be flexible to suit the needs of you and your project.
- Finance can be arranged without exit fees, non-utilisation fees or early repayment charges.
Many people that speak to our team are worried their lack of experience in the building sector will restrict the amount of finance they can borrow or hold them back from developing their dream project. This isn’t the case at all, here’s a recent example of client we worked with on their first self-build project.
Recently we were approached by a new client who was looking for assistance in buying a property; the property had previously been used for commercial purposes but had been granted planning permission to convert into a residential dwelling. The client wanted our help to arrange the finance.
The purchase price of the property was £600,00, in addition to this there would be development costs of £115,000 along with stamp duty and legal fees. Once the project completed the property would have a gross development value of £900,000.
As independent advisers, we have access to the whole of market which means we can source the most competitive finance solutions for our clients. In this instance, we were able to secure a facility of £585,000 of which £390,000 was released on the first day, to assist with the cost of the purchase.
The remainder of the funds (£195,000) was released in 3 stages as the build progressed. The benefit of this to the client is that he was only charged interest on the funds that were released, therefore minimising the overall sum. The loan arranged by us was exempt from any exit fees or early repayment charges. The lenders charged a 2% arrangement fee.
At the time of writing, this project was just 2 months away from completion and we are in discussions with the client to arrange a residential mortgage; this mortgage will refinance the self-build mortgage.
For more information on making your dream project a reality contact the KDW Commercial team:
01727 85 22 99 | enquiries@kdwcommercial.co.uk | www.kdw.co.uk/commercial