Self build homes to benefit from section 106 exemption

A major boost for people that intend to build their own homes has been announced by the governments Community Secretary Eric Pickles. Currently a levy is applied to all most new homes that are built in the private sector. This levy is called a section 106 and is supposed to fund local infrastructure projects and social housing. I

It can run into tens of thousand of pounds on larger developments but is also an expensive addition for people that are looking to build their own family home. News that the section 106 fee will be waived for self builders will be welcomed.

The fee can mean an extra £10,000 – £20,000 for a single home and is seen as an obstacle. The government is keen to encourage this sector of the market and removing this charge will definitely help self builders develop their own homes. Some councils have been criticised because some of the charges being applied are exorbitant.

Some schemes have become unviable because of these charges. In one instance a new house in the New Forest was charged a fee of £32,000. This project was a typical two storey three bedroomed property. The scheme didn’t go ahead because of the levy.

It is sites like this that Eric Pickles wants to see being built in order to ease the housing crisis. Whilst it may be a vital source of income for local authorities on larger sites from developers more needs to be done to help families and self builders by removing this levy. The charges for a section 106 notice is certainly not insignificant. In London a typical self build home could cost a self builder a figure in the region of £45,000.

This in itself is prohibitive and is on top of all of the other charges applied by the local authorities such as building control fees and fees and planning fees. if the government wants to encourage these schemes to go ahead this charge should be scrapped altogether.