ditchmyster

iTrader: (7)

I think they have already lost out big time, hence all the bleating.

@Fatscoobfella1.
As for building a house for £100k, you might get a base 4 walls and a roof but I doubt you'll get much else, bathroom, kitchen, plastering,cabling for electricity, plumbing, tiling, floor coverings, central heating, switches & sockets, doors, windows. That list will suck the best part of £70k and that's without sundries like nails, screws, pipe clips, ducting, insulation, Architect, site manager, a gazillion phone calls and a couple hundred gallons of fuel traveling all over the place for everything related to the job.

And the big killer; Plot of land with outline planning permission for less than £50k not a ******* chance.

I'm currently renovating an old farm house in Croatia and you can't build a house for £100k out here and most already own the land, so you've got no chance in England.

Ever watched the property programs? Everyone goes over budget by about 30% and they generally don't add all the little things, it costs a lot more by the time you end up sitting on your sofa sipping a cuppa in a warm house with curtians/blinds and other simple things like plates, cutlery, sheets etc. I can go on for ever but i'm sure folks will get the general idea.

That's why houses cost £200k.

Oh and ding; I can last about a week in London, then i've had enough, you gota admit the place is a **** hole for the most part.

Dingdongler

If you don't like big cities you won't like London that's for sure. I've travelled quite a bit but still love coming back to London.

There are lots of run down bits but London also has a unique mix of cutting edge, heritage, history, arts, architecture etc. I also like the diversity especially in terms of food!

And I see the run down bits as 'opportunity' (once we get the benefit claimants out and send them up North to where Fatscoobfella lives)

fatscoobfella1

iTrader: (1)

You cant send all the scroungers up to me.... We dont have any council (or social) housing in our village..Keeps away all the riff raff,spongers and people with no money,we dont want any undesirables in our conservation area...

Ditch...

We built a house for just over £90k....3 bedroom detached.. That was build costs only,not the land and granted it was 8 years ago...
We subbied all the work out as im useless at any kind of building..
I thought costs would be similar as materials seemed to have got cheaper if anything ?? Of course,i could be wrong as building is not my game..I was just going off experience.

Having lived in big Cities including London and Manchester and a short time in Birmingham i can readily confirm that London is the cesspit of the UK..

Diversity,history,heritage are present.....But its filled with awful people.

tony de wonderful

The big construction firms only pled poverty so they could get the government to institute more schemes to inflate the market. Why would you build now when you have the expectation of price increases in the future (and thus more profit)? Expectations built upon the moral hazard of recent state interventions in the housing market (mainly indirectly through monetary policy)? It also increases their land bank value, improving their balance sheets.

With your faith in the market do you not think that, let's say for sake of argument that if house prices fell, that builders would not find ways to cut costs and still make a profit? What else can builders do but build? No building equals no profit.

tony de wonderful

If markets were always 'correct' then we wouldn't have economic cycles, booms and busts, bubbles and crashes.

The crisps have gone up because of retail price inflation rather than price growth per se. You would probably find that you can buy more crisps with the average wage now than 40 years ago, but less of a house.

Also you haven't factored in that the property market is also a mortage market, it is all dependent upon the price of credit. You don't buy crisps on a mortgage.

Dingdongler

I thought we were trying to have a sensible conversation. However since you've decided to generalise near on 10 million people I'll call it a day.

ditchmyster

iTrader: (7)

That's the reason houses have gone up.

mattstant

Errrr yes you CAN build a house for 100k I know because this is what I do for a living and I have direct build costs on my spread sheets right now showing a 3 bed detached cost us 75k last year to build (not including overheads)

What you Can't do is :-
buy the land,
pay for numerous expensive consultation reports on anything from the odd speed bump to redirecting the local sewer network,
Satisfy section 106 agreements (tantamount to the local authority robbing you blind to pay for a new science block at the local school because they've blown the budget on god knows what else),
Finally get a recommendation to approve only for it to be refused by the local parish committee because nimbyism is now a recognised religion and **** everybody regardless that there is a desperate need for new housing
And also that mud rutted gorse and nettle ridden half acre field has suddenly become the new Jerusalem such that not even the combined lyrical waxing's of Keats Byron and Tennyson could adequate convey its bucolic charm and the signing of magna carta must have happened there as well probably.

Then trawl through the appeals process with v expensive consultants v expensive lawyers to have it overturned.

And on top of all this you also run the risk of getting up to 30% of your site sucked into social housing an unbelievably iniquitous piece of social engineering which says you MUST discount your new builds to the poor and needy.

the result being potentially a mini ghetto on your nice new build site.
I'm NOT saying its inevitable but there are plenty of horror stories and not just in the daily mail either.

Put it like this THE first question every buyer asks is "where is the social housing on the site" and the first plots sold will be those less exposed to them.

by the time you've done all this you may just make a profit hopefully 20 % but I have only broke even in the past.

This "theory" that house builders are hoarding land is just that.

this hoarding nonsense is about sites with onerous 106 agreements that were created when local authorities decided to cash in on the last boom by insisting contributions that relied on a house price increase over the development period.

Dingdongler

Thanks Matt, a very informative post.

May I ask a few questions?

You mentioned you built a house last year for £75k, how many m2 was it? And what did you mean by £75k 'excluding overheads'?

Many thanks

ditchmyster

iTrader: (7)

So in short you agree with me then.

Maybe some of the major house builders/devlopers can get the unit price down by bulk building and buying, but I stand by my statement that there is no ******* way a normal person if they had £100k budget will be able to buy land and build a house with all the costs INCLUDED not excluded.

pacenote

+ 1

fatscoobfella1

iTrader: (1)

And that Sir,is its first problem...

fatscoobfella1

iTrader: (1)

Good post...

Are you talking about multiple houses and small estates here,or single dwellings ?

mattstant

stupidityit was a semi detached around 500 square feet (NOT meters thanks john)
Build costs assumes a simple flat serviced plot ie no big long driveway and all common services in the footpath close by
I class overheads as office expenses directors and admin salaries/vehicles (ie My wages) which obviously brings in economies of scale.

mattstant

Err not quite you did state the following

"As for building a house for £100k, you might get a base 4 walls and a roof but I doubt you'll get much else, bathroom, kitchen, plastering,cabling for electricity, plumbing, tiling, floor coverings, central heating, switches & sockets, doors, windows. That list will suck the best part of £70k and that's without sundries like nails, screws, pipe clips, ducting, insulation, Architect, site manager, a gazillion phone calls and a couple hundred gallons of fuel traveling all over the place for everything related to the job."

land costs excluded I know I can build a small 3bed detached for 80k so if you assume the average punter may pay 20% extra a complete new build could be done for 100k

In your situation your are almost certainly paying vat.
On new build in the uk there is no vat and the same should apply for the a small self build QED

Your original statement made no mention of land which you have now added onto the 100k which is obviously not atainable

mattstant

At the moment we are working on a site of 60 dwellings which is now about half way through.

Any trade discounts we negotiate don't necessarily require us to order vast amounts of quantities so we should be able to do smaller sites for the same or close to the same figures.
Its swings and roundabouts really as the smaller sites generally will need less expensive infrastructure ie no adoptable roads and sewers but because of this can go for more per square foot.

You can do all the analysis you want but more often than not it comes down to a gut feeling that a certain site even with planning problems can sometimes just feel right

john banks

500 sqm for £75k is very impressive. My house was 550sqm and it was £55k plus £5k for professional fees to convert 80sqm and about £25k inc fees to add 48sqm garage (complex ground works, sloping) with 32sqm boarded attic over doing a lot of work myself, wife project managing, sourcing materials cheap and reusing what we could, although conversions aren't necessarily cheaper than new build.

mattstant

Errrr well spotted john this idiot didn't read his own spread sheet properly should have said 500 square feet NOT metres

john banks

That would be a very small 3 bed?

mattstant

that's ground floor footprint so double for second floor as well

john banks

Understood, about spot on with RIBA guidance for a 3 bed, about £800/sqm cost too.

mattstant

I know we could cut it down further but quality would start to suffer.
The big boys like Barrat Bovis et al however?..............

ditchmyster

iTrader: (7)

Errr yes it did.

ditchmyster

iTrader: (7)

Not once but twice.

I rest my case.

ditchmyster

iTrader: (7)

I also said to Include everything as i'm talking total build cost to the point where you can move in and your sat on the sofa sipping a cuppa.

Yes I am paying vat but that was a choice I made based on the laws out here, because i'd rather pay vat on materials than the value of the house come sale time, 22% on £100k is better than 28% 0n £500k the way i've done it i'll only get hit for 6% and the house is in my name not a company, which also has other tax and expenditure benefits come rental time.

I understand where your coming from though, but my points were always based on a private individual building a house. Sorry if I didn't make that clear enough for you.

BrownPantsRacing

iTrader: (6)

I agree!

May have an effect on chains falling through I suspect, but not ultimately house prices.

Our village prices have not dropped since we purchased 7 years ago. In fact, I put our house on the market last week and it was valued considerably more than we paid by all agents that priced it up! Ours has seen an 18% increase in 7 years.

Dingdongler

Thanks Matt.

So if I gave you a cleared site with all utilities already present how much would you charge ME to build a house ie per m2?

Thanks

mattstant

Wise choice on the vat

think we've got there

mattstant

Now there's a question never ever contracted out only ever built on spec.
As such we are specifically set up as a kind of production line
would have to be very careful and make sure every possible specification and design detail is correct and agreed on, a reasonable time line, stage payments no economies of scale ????? can only stab at it with a finger in the air at about 150-160/sqft

Dingdongler

Could you please explain what that means?



Your £75k for a 1000sqft house equates to £75/sqft.

My question was really what should a builder charge me such that he still makes an acceptable profit?

Thanks again and sorry if my question is vague