The Government wants mortgage lenders to prove they have plans to carry out more lending to custom-built homes and help ease the housing crisis.
A housing white paper published today by the Department for Communities and Local Government says the Conservative party wants more custom-built homes.
It says: “These enable people to choose the design and layout of their home, while a developer finds the site, secures planning permission and builds the property.
“Custom built homes are generally built more quickly and to a higher quality than other homes, and tend to use more productive, modern methods of construction.”
But the housing white paper says the barriers to more custom-built homes are access to land and lack of appetite from mortgage lenders.
The white paper says: “Mortgages for custom and self-built homes represent a very small proportion of the overall lending market.”
The Government says it will “work with lenders to ensure they have plans in place to increase their lending in line with consumer demand.
“We are delighted that Virgin Money plans to start lending on custom build projects in the summer.”
The white paper adds that the Government will “support a joint working group with lenders,
valuers and the industry to ensure that mortgages are readily available across a range of
tested methods of construction.
“This will include encouraging industry and lenders to develop a stronger set of core data to measure the use and performance of different technologies to encourage good decision-making.”