SUMMARY OF REPORT CONTENTS

The overall self-build market in the UK is estimated at around £4.03 billion in 2002. 

The self-build housing market has witnessed rapid growth levels since 1995, with the total market value rising by over 45% over the last 6 years, primarily stimulated by 2 key sectors - land prices and labour costs - both of which have risen rapidly during the last five years and both of which are forecast to grow rapidly in the future. However, all sectors in the self-build market are performing well at present, with above inflation growth in the materials sector, due to the continued emphasis on higher value and often niche products.

Material costs are currently worth an estimated £1.21 billion, labour costs currently estimated to worth £1.17 billion, land costs which have been estimated at £1.13 billion in 2002 and miscellaneous costs estimated to be worth £0.52 billion.
Within the self-build industry there are two broad segments - private self-builders and social self-builders. Social self-builders are often part of a Registered Social Landlord (previously Housing Association) and account for around 2% of the market. The processes, materials and needs of these 2 segments are significantly different from each other and are therefore analysed individually. The market can also be divided into 3 generic construction methods - timber frame housing, traditional brick and block, and other new construction materials. Share taken by timber frame is increasing and now accounts for around 25% of the market by volume.

With regards to who is self-building there has been a shift from those on low incomes to those in the ABC1 social grouping on a relatively high income who are looking for better value for money in a new home.

Six key distribution channels have been identified in the market, each having significant importance in particular product sectors. The wide ranging number of products involved in the self-build market means that the distribution structure in the self-build market remains highly fragmented, though builders merchants account for over 55% share.

The fragmentation of the product supply in the self-build market is immense due to the amount of individual suppliers in the market. Each of these suppliers operates to a greater or lesser extent in the self-build market and ranges from timber frame kit manufactures to producers of screws and fixings.

In the private sector, the trend towards higher value products is expected to continue to add value to the sector as self-builders look for more environmentally friendly products, greater energy efficiency, enhanced aesthetic designs, functionality and products which renders the overall self-build process less complex. The introduction of Part L legislation has lead to higher value products as thermal insulation becomes a priority. Hence products which offer certain benefits, such as permanent insulated formwork systems, which are filled with concrete, structural insulated panels, integrated cabling solutions, underfloor heating, pre-fabricated timber frame etc., are all likely to witness an increase in demand in the short to medium term.

Although the actual construction process of a self-build house has become significantly easier during the last decade, the processes of specification and purchase of products and materials has become increasingly complex as manufacturers offer more advanced construction materials, added value products etc. 'Turnkey' solutions are increasing in popularity in the industry with many of the companies involved in the production of self-build housing kits now offering a complete solution.

The individual nature of many self-builders and the desire to construct the 'perfect' home often provides a greater degree of motivation for managing the project themselves. Self-builders are generally highly motivated and often are well-versed in new construction methods, materials and products, often more so than traditional building product distributors. This results in an end-user with different, perhaps more specific needs in terms of information and service than traditional customers of building products. It must be noted however, that as little as 5% of self-builders actually undertake a self-build project completely by themselves.

Forecasts for the UK self-build market look optimistic. With a growing number of media sources promoting the self-build concept there is estimated to be significant rises in volume and value of the self-build market to reach an estimated £5.25 billion in 2005. An increasing proportion of the population desire to own a better quality accommodation than they could afford on the property market, which is particularly an issue at present given the rapid rise in house prices in the last 3 years.

In European countries, self-build often represents as much as 60% of all new houses built and with this figure at around 13% in the UK, it shows that the market is still someway behind. As awareness continues to grow in this arena, and the antipathy towards the easier-to-erect timber frame houses subsides, the self-build market should experience reasonably high levels of growth, particularly in Scotland although indications are that England will also experience rises in volume. However, the market may be constrained by lack of available land and high land and labour cost, due to current and future predicted skills shortages in the labour market.

List of Companies Mentioned

Prestoplan Purpose Built, Wilson Connolly, Beazer Homes, Elliott Group, Willmott Dixon Ltd, Willmott Dixon Group, Yorkon and Westbury, Sterling Insurance Group, Skipton Building Society, Lloyds TSB, Bradford & Bingley, Lambeth Building Society, Belmont Mortgages, Potton Homes, The Bungalow Company, Carronvale Homes, Scotframe, Thomas Mitchel Homes, Scandia Hus, Custum Homes, Alpine Timber Frame, Taylor Lane Timber Frame, The Border Design Centre, Cedar Self-Build Homes, Flemming Homes Ltd, The Stewart Milne Homes Group, Stuart Milne Timber Systems, The self-build House Company, Viceroy, TJ Crump, Oakwrights, Border Oak, Welsh Oak, Carpenter Oak and Woodland, English, Heritage Buildings, The Log Cabin Company, Anglo-Nordic Management Ltd, The Real Swedish Log Cabin Company, Rayne Constructin Ltd, Timberville, Falshaw Homes, H & H Celcon, NewHause Systems, CB Homes,  Kingspan Tek Haus, BPAC, TJ Crump Oakwrights, Jablite, Steel Framed Homes & R Welding Lifetime Homes, William Wilson Howarth Timber, R K Timber, Saint Gobain Group, Wolseley Centers, Wickes, BSS Group, BMB Builders Merchants, Chandlers Building Supplies, The Grafton Group plc, Plumbase, Macnaughton Blair, Gibbs and Dandy, Homebase, Focus DIY Group.