Building Your Own Home: All you need to know to build your own home
If you want to be far from the madd(en)ing crowd, you can buy a plot of land and have a house built to your own design and specifications or to a standard design provided by a builder.
Note, however, that building permission is quite difficult to obtain, particularly in the south-west where it’s strictly controlled by the local authorities. In general, building a home in Ireland, or anywhere else for that matter, isn’t recommended for the timid. However, there are many excellent builders in Ireland who will build an individually designed house on your plot of land or will sell you a plot and build a house chosen from a range of standard designs.
The cost of land in Ireland varies considerably according to the area. Prices have escalated sharply in recent years in some areas, because of the demand for new homes. Land can represent up to half the cost of building a home, although it’s still possible in many areas to buy a plot of land and build a bigger and better home for less than the cost of a resale property. And the more land you buy, the cheaper it is. But when putting in your bid, don’t forget the old Irish adage: “The wrath of God has nothing on the wrath of an Irishman outbid for land”!
Building your own home allows you not only to design it yourself, but to ensure that the quality of materials and workmanship is first class. There’s no VAT on land purchased for building a home, but VAT at 12.5 per cent is payable on the building itself (it should be included in the prices quoted by builders).
Some builders offer ‘package deals’ which include the land and the cost of building a home. However, it isn’t always wise to buy the building plot from the builder who’s going to build your home, and you should shop around and compare separate land and building costs. If you do decide to buy a package deal from a builder, you should insist on separate contracts for the land and the building, and obtain the title deed for the land before signing a building contract (see below). In most cases, a plot of land is purchased and then a builder is contracted to build a house on it.
Buying a Building Plot
You must take the same care when buying land as you would when buying a home. The continued housing boom in Ireland means that plots of land are being snapped up as fast as they become available and you may need to negotiate directly with the vendor (in most cases a farmer) rather than buying through an estate agent. In this case, it’s particularly important to ensure that the land has been approved for building and that the plot is large enough and suitable for the house you plan to build. You must check with the planning authority of the local county, borough or urban district council that’s responsible for preparing and updating the development plan for the area.
According to this plan, land is ‘zoned’ for particular use: residential, amenity, commercial or industrial. Some areas may be zoned for mixed use, but any development must be in accordance with the zoning. These plans are revised every five years (new strategic planning guidelines for the Dublin area were published in 1999, for example). Development plans may be consulted at the planning authority’s office or at the local library.
You should also check with the planning officer whether there are restrictions on the type of building which may be constructed. In scenic areas, for example, there may be limits on a building’s height. Some plots are unsuitable for building as they’re too steep or require prohibitively expensive foundations. Also check that there aren’t any obstructions such as high-tension electricity lines, water pipes or rights of way which may restrict building. Note that the cost of providing services to a property in a remote rural area can be prohibitive and it must have a reliable water supply. It’s also worth checking whether a plot is in an area where there are high levels of radon gas.
It may be possible to build on agricultural land, but it will depend on whether you’re an EU citizen and whether the land has been zoned for house building. Although there are theoretically no restrictions on EU citizens purchasing land in Ireland, the authorities may insist that farm land is retained as such and not purchased for conversion into residential or commercial property.
If you’re a non-EU citizen, you may need written consent from the Land Commission to buy agricultural land, although obtaining such consent is more or less a formality and it’s rarely, if ever, withheld. You will need to obtain Form NQ1 from the Department of Agriculture and Food. The minimum plot that can be built on is usually 2,000m2 (half an acre) with a frontage of at least 60m (200ft).
Before buying land for building, you should obtain a land registry map to certify that the plot has been properly registered. Ensure also that the purchase contract is dependent on obtaining the necessary planning permission and check for yourself that the correct planning permission is obtained (don’t simply leave it to the builder). If planning permission is flawed, you may have to pay extra to improve the local infrastructure; the property may even need to be demolished!
Planning permission is not required for building a house or an extension (e.g. conservatory) of less than 40m2 (430ft2), as well as for erecting a fence or wall more than 2m (6ft) high or a path or pond more than 1m (3ft) above the surrounding ground level. Certain internal constructions may also require planning permission.
There’s a set procedure for making a planning application. First you must place an advertisement in the local newspaper indicating your intentions, and your planning application must be submitted within two weeks of the appearance of the advertisement. The application must include two copies of the newspaper advertisement as well as a site location map (four copies), detailed drawings/ elevations (four copies), a site layout plan (four copies), a site notice (two copies) and the application fee. Obviously, the cost of preparing drawings and plans will be far greater than the application fee itself.
You need to decide in advance whether to apply for outline planning permission first. This is a sort of agreement in principle, a way of ‘testing the water’ if you’re unsure whether permission will be granted. The costs involved are less, but you cannot start building until full approval has been granted. Once outline planning permission has been given, you can submit detailed plans for approval. Alternatively, you can make a full application for planning permission from the start. This will save you time but, if it’s refused, you’ll have wasted money on producing plans and drawings. As they say, “you pays your money and you takes your choice”, although by taking expert advice you can minimise the risk involved.
Once you’ve submitted your application for planning permission, the local authority has two months in which to make a decision, although they may ask for more details. There are three possible outcomes: permission is granted, permission is refused or permission is granted under certain conditions.
If permission is granted, you have five years in which to complete the construction (note that the planning authorities are under no obligation to renew the permission after this period). However, it’s important not to start building work until at least a month after the planning authority’s decision to grant permission. During this time it’s possible for other people to object to the planning application or to appeal against the planning authority’s decision. The official ‘ grant of permission’ is therefore not issued until one month after the initial decision. Even then, you may need to obtain other approvals before building can start, such as permission to connect to a public water main or sewer. Finally, building control regulations require the service of a commencement notice on the building control authority (which is generally the planning authority itself).
If planning permission is refused or you’re dissatisfied with the authority’s decision, you can appeal to An Bord Pleanála, a sort of planning appeal court, whose decision is final. Your appeal must be lodged within one month of the planning authority’s decision. The penalties for carrying out work without the necessary planning permission are severe and include fines and prison sentences of up to two years.
Even if you don’t need planning permission, e.g. for an extension of less than 23m2 (247ft2), you may (depending on the area) need bye-law approval from the building control section of your local authority. You must obtain the appropriate application form and pay a small fee.
The authorities are particularly concerned about safety standards (particularly in Cork city and parts of Co. Dublin ), e.g. that a kitchen extension doesn’t cover a main sewer, that an attic or loft conversion has adequate ventilation, and that extra toilets and bathrooms have proper plumbing and drainage. Note that even garden sheds must be constructed in accordance with the bye-laws relating to open spaces.
The authorities have two months to consider bye-law applications. Once you’ve obtained approval, you must notify them in writing when you intend to start work and when you’ve finished. It may seem a lot of bother for what may be only a minor alteration, but it’s obviously in your interest to ensure that any work meets the required standards so that you’re adding to the value of a property rather than subtracting from it. In fact, you may not be able to sell the property at all if you haven’t obtained the necessary approval – prospective buyers may be unable to secure a loan if the planning documents aren’t in order (they can apply for a retention order, i.e. permission to retain an unauthorised structure, but this can take a long time and there’s no guarantee that it will be granted).
Note also that it isn’t possible to obtain retrospective bye-law approval. When buying, you should therefore ask your solicitor to check that the necessary approvals for alterations or extensions have been obtained.
Finding an Architect & Builder
When looking for an architect and builder it’s best to obtain recommendations from local people you can trust, e.g. neighbours or friends. Note that estate agents and other professionals aren’t always the best people to ask, as they may receive a commission. You can also obtain valuable information from expatriates and from owners of properties in an area that you particularly like.
Architects’ fees are usually calculated as a percentage of the total cost of the work (normally around 10 per cent), which doesn’t encourage them to cut costs. You’re advised to use an architect who’s a member of the Royal Institute of the Architects of Ireland (RIAI), which requires a high standard of qualification and competence. The RIAI can supply you with a copy of its Conditions of Appointment for Domestic Work, which covers all aspects of the services offered by RIAI members (Tel. 01-676 1703).
A good architect should be able to recommend a number of reliable builders, but you should also do your own research, as the most important consideration when building a home is the reputation (and financial standing) of the builder. However, you should be wary of an architect with his ‘own’ builder (or a builder with his own architect), as it’s the architect’s job to ensure that the builder does his work according to the plans and specifications (so you don’t want their relationship to be too cosy).
Inspect other homes a builder has built and check with the owners what problems they’ve had and whether they’re satisfied. Ask the owners if they used software like the punch list by Procore to see if the builder is organized and up to date with the latest practices. Bear in mind that building standards vary and you shouldn’t assume that the lowest quotation is the best. Note that it’s imperative that the builder has an insurance policy (or ‘termination’ guarantee) to cover you in the event that he goes bust before completing the property and its infrastructure. This must be specified in the contract.
There are few large building companies in Ireland, where most builders are more or less ‘one man bands’. When choosing a builder, make sure that he’s registered with Homebond, the scheme set up by the Construction Industry Federation and operated by the National House Building Guarantee Company. If a builder is a member of the Irish Home Builders’ Association (IHBA), he’ll automatically be Homebond registered. Homebond provides three types of guarantee: against the loss of a deposit in the event of the builder going bust; against water and smoke damage for two years after completion; and against major structural defects for ten years after completion.
Note that banks and building societies require Homebond registration on new houses, which is certified by Homebond Certificate HB47. When you enter into an agreement with a builder, you should immediately receive the Homebond Form HB10 incorporating the guarantee, and you should ensure that your solicitor receives this document at the earliest possible stage.
According to the IHBA, a significant number of houses are still being built without certification, particularly in the west and north-west, so if you’re buying without finance from an Irish bank or building society, make sure you obtain the necessary Homebond certification. Queries relating to Homebond should be addressed to Homebond, Construction House, Canal Road, Dublin 6 (Tel. 01-491 0210).
If you want a house built exactly to your specifications, you’ll need to personally supervise it every step of the way or employ an architect to do so for you. Without close supervision, it’s highly likely that your instructions won’t be followed to the letter.
You should obtain written quotations from a number of builders before signing a contract. Once you’ve chosen a builder, your architect will prepare the contract documents, which will include a ‘form of contract’ and a set of drawings and specifications. These will be sent to the builder for completion. The builder will then provide you with a programme for the job, indicating the projected start and finish dates, and evidence that he holds the insurance required under the contract.
The contract should include a detailed building description and a list of the materials to be used (with references to the architect’s plans), the exact location of the building on the plot, the building and payment schedule, which must be made in stages according to building progress, a penalty clause for late completion, the retention of a percentage (typically 10 per cent for domestic work) of the building costs for up to 12 months as a guarantee against defects, and and explanation of how any disputes will be settled.
Ensure that the contract includes all costs, including the architect’s fees (unless contracted separately), landscaping (if applicable), all permits and licences, and the connection of utilities (electricity, gas, etc.) to the house, not just to the building site. The only extra is usually the cost of the mains water connection.
Before accepting a quotation, you should have it checked by a building consultant to confirm that it’s a fair deal. You should check whether the quotation (which should include VAT at 12.5 per cent) is an estimate or a fixed price, as sometimes the cost can escalate wildly as a result of contract clauses and changes made during building work. A fixed price contract isn’t usual in one-off projects, because the scope of the work required frequently changes during the project. It is, however, possible to have a fixed rate contract whereby the unit cost of each element in the project is fixed against inflation. It’s vital to have a contract checked by a solicitor, as they’re often heavily biased in the builder’s favour.
You’re usually expected to pay a deposit of up to 10 per cent of the agreed price. How the remainder of the cost is paid varies from one part of the country to another. In Dublin, for example, you usually pay the balance on completion, whereas in Cork you normally pay in instalments.
Instalment payments may be made at fixed stages in the construction process, e.g. on completion of the external walls, the roof and the wiring. More often, however, the work is valued and paid for at fixed intervals, e.g. monthly. In either case, your architect will value the work as it proceeds and advise you, by way of ‘architect’s certificates of payment due’, how much is owed to the builder.
Make sure you have all work inspected by your architect before making any payments. In any case, Homebond’s own inspectors will be required to see the work at certain stages (typically when the foundations have been opened, when the drains are available, and on completion).
When building work is nearing completion, your architect will carry out particular inspections and have the builder attend to any defective or outstanding work before ‘practical completion’ of the work is certified, half of the retention money released and the job handed over to you. At this stage you’ll need to ensure continuity of insurance cover from the builder to yourself. After practical completion, there’s a ‘defects liability period’, during which the builder will remedy defects without charge. This usually lasts between six and 12 months and, ideally, extends through a winter. At the end of the defects liability period and after the builder has made good any defects that have become apparent, the balance of the retention money is released; this constitutes ‘final completion’.
Note that it’s important to ensure that payments are made on time, otherwise you could forfeit all previous payments and the property could be sold to another buyer.