18 August 2012
Chancellor George Osborne is being urged to back self builders with low-cost bank loans through the government’s Funding for Lending scheme.
Ted Stevens, Chair of the National Self Build Association (NaSBA) and Raymond Conner, CEO of Buildstore have written to Mr Osborne urging him to support their call to lenders to allocate at least £1billion of the lending scheme for additional lending to self build mortgages.
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While many of the major housebuilders’ projects have been cut back by up to 40 per cent since 2007, self build completions have continued to rise – prompting a call from the industry to back self build as a route to economic growth.
In recent years, it has become increasingly hard for would-be self builders to obtain a mortgage. But, according to their estimates, if £1billion were directed to the self/custom build sector, this would not only make a massive difference to self build, it could also stack up to around 6,000 new jobs and, as many self-built homes are more energy conscious, would also help achieve carbon reduction commitments.
Ted Stevens said; “The main lenders tend to put self-build into the ‘too difficult’ box, most lending comes from small local building societies,”
Raymond Connor added: “Just £1bn from Funding For Lending would make a massive difference to self-build. There is then the possibility of banks lending on to self-builders more cheaply.”
Under terms of the Funding for Lending scheme, neither the Treasury or the Bank of England can interfere with commercial decisions because the credit risk remains with lenders, but it is hoped that it could open up discussions about how the scheme could benefit the self build sector.
