A new £210 million scheme has been unveiled by the Welsh Government with the aim of making it easier for self-builders.

Under the programme the Development Bank of Wales will offer loans on pre-agreed plots which will be repayment free until the new home is mortgaged allowing people to build their new home and cover living costs.

Successful applicants can choose to use an approved builder or in certain circumstances do the work themselves and local authorities and housing associations will make plots available with planning and site requirements complete.

In addition, every plot will have a ‘Plot Passport’ including approved designs, an estimated build cost and options for personalising the home.

Approved applicants can reserve a plot by providing a 25% deposit on the plot cost and the Welsh Government through the Development Bank of Wales will provide the rest of the funding.

‘We want to make self-build available to many more people in Wales, not just the most privileged households. Finding the land, navigating planning consents and being able to afford to self-build while covering the cost of living can be real barriers,’ said Housing and Local Government Minister Julie James.

‘We have launched this scheme in partnership with local authorities to overcome all of these barriers. This offers a route into home ownership for people who want to stay in their local area but haven’t previously been able to afford to buy there. It also offers older and disabled people the opportunity to build custom adaptive housing that meets their needs in the communities where they want to live,’ she explained.

‘Figures suggest an average self-build house in the UK costs only 70% to 75% of its final value because no developer profits are involved. This puts that benefit into the pocket of the homeowner. At around 10% of new homes the UK has a much lower rate of self-building than other countries around the world,’ she pointed out.

‘As we work to increase the amount of housing available, this scheme will help people who wouldn’t normally think of self-build to consider it seriously,’ she added.

The scheme will launch in late spring this year, and in the coming months there will be more information available on the Your Home in Wales website.

Cenydd Rowlands, property director at the Development Bank of Wales, described it as ‘an exciting and highly innovative’ new scheme. ‘We are aiming to break down the barriers that often prevent people from taking on the challenge of building their own homes and help turn such dreams into reality. The scheme complements other funds we manage focussed on helping the property market,’ Rowlands said.

It was welcomed by Andrew Baddeley-Chappell, chief executive officer of the National Custom and Self-Build Association. .Most of us aspire to build our own homes, yet despite the growth in the sector, too few currently achieve that dream. Putting the home owner in charge leads to more homes of better quality and value,’ he said.

‘It helps bond the homeowner to the community where such homes are built. This package of measures sends a clear message that Wales welcomes and supports self-builders and we are excited to see the positive benefits that will flow from this announcement,’ he added.

It was also welcomed by the Federation of Master Builders (FMB). ‘When you consider the housing crisis that exists, the custom and self-build market has been an under-utilised sector in the ongoing battle to meet the demand for homes,’ said Ifan Glyn, director of FMB Cymru.

‘Research has shown that over half of adults in the UK would one day like to build their own home. Across the EU, approximately one third of all homes are custom or self-build whereas in Wales, it’s just 5%. People want to custom or self-build their home but the right conditions haven’t been in place to allow them to do so,’ he pointed out, adding that significant growth in the custom and self-build market could help alleviate the housing crisis and will expand opportunities for small building firms across Wales.

‘The house building market is today dominated by a small number of very large companies. In 1988, some 40% of all new homes were built by small firms. Today, that figure is down to just 12%. The type of firms that get involved in custom self-build projects tend to be small, therefore this can provide an opportunity for small contractors to re-engage with house building,’ he explained.

‘Self-Build Wales could play an important role in creating new sources of supply, by encouraging new entrants into the house building sector and generally boosting the health and diversity of our industry,’ he concluded.