There are 2,640 people on self-build registers across the ten Devon planning authorities, and the single question that decides whether their project starts is not planning and not the plot price. It is whether their lender pays before the work or after it.

Almost all of them pay after. On an arrears basis the lender releases each tranche once a stage has been completed and revalued, because the finished work is the security. Suffolk Building Society, one of the smaller societies active in this market, sets the position out plainly: the most common method is in arrears, which means “you must ensure you have adequate funds to finance the work upfront first”. Advance products exist, where money arrives before the stage is built, but the society notes they are less common and typically priced higher, because the security for the loan does not yet exist.

For a household in Okehampton or Holsworthy building a house rather than buying one, that distinction is the whole project.

How many Devon households this affects

The Right to Build registers are a statutory record of people who want a serviced plot in a given district. The Ministry of Housing, Communities and Local Government published the ninth base period on 5 September 2025, covering 31 October 2023 to 30 October 2024.

MHCLG Right to Build registers monitoring, ninth base period, published 5 September 2025.

Teignbridge and South Hams between them hold more than half of Devon’s registered demand. Nationally there were 64,851 individuals on registers at the end of the period, against 4,302 planning permissions granted for serviced plots across all of England, a figure down 18% on the year before. Demand is not the constraint. Serviced plots and stage-payment cashflow are.

East Devon is the district that does this differently. It operates a local connection test and splits its register into two parts, and as its planning policy pages explain, the council’s legal duty to permission plots relates to the numbers on Part 1 only. Applicants who meet the general criteria but fail the local connection test go on Part 2 and are counted for demand but not for the duty.

What arrears costs in cash on a Devon build

Take a project in Teignbridge with an all-in figure of £400,000 for plot and build, against an average detached price in that district of £480,980 in June 2026 on the Land Registry UK House Price Index. Split into six stages, the arrears model asks the household to fund each one in full before the lender releases anything against it.

Illustrative stage split on a £400,000 project. Stage boundaries and amounts vary by lender and by build contract.

The plot is the hard part. £120,000 has to be found and held before a single release, and nothing is recovered until the foundations are signed off. A household with the deposit but not the working capital has a project that cannot start, whatever the paper affordability says. On an advance basis that first bridge disappears, which is why those products exist at all and why they price higher.

Build costs are rising into a falling market

The awkward part of the arithmetic in 2026 is that costs and values are moving in opposite directions across much of the county.

Devon’s average property price was £304,968 in June 2026, down 0.1% on the year, and South Hams fell 6.8%. Only East Devon, up 3.5%, and Torridge, up 3.9%, made meaningful ground. The lender indices for August 2026 disagreed with each other on direction, which is its own warning about relying on any single measure. Meanwhile the BCIS General Building Cost Index rose 1.4% between the first and second quarters of 2026, annual growth of 3.8%, and its five-year forecast published on 6 July 2026 puts building costs up 13.1% and tender prices up 15.5% by the second quarter of 2031.

Dr David Crosthwaite, chief economist at BCIS, summarised the position in that forecast: “Rising energy and materials costs are creating renewed inflationary pressure across the construction supply chain, but weak demand remains the dominant force in the market.”

For a self-builder that cuts both ways. Contractors competing for work in a contracting market, forecast to shrink 2.7% this year, may quote keenly. But the fixed price they quote is fixed against materials that BCIS expects to keep climbing, and on a build running eighteen months the risk sits with whoever signed up to absorb it.

The counterweight

Arrears is not simply the lender being difficult. Releasing against completed, revalued work is what allows a society to lend at all on a site with no house on it, and it is a genuine protection for the borrower too, because it stops money being drawn for stages that never get built. It also means interest accrues only on what has been released, so a staged drawdown on a year-long build costs materially less in interest than borrowing the whole sum on day one.

The households that get caught are not the ones who chose the wrong product. They are the ones who budgeted for the cost of the house and not for the cost of the gap.

Frequently asked questions

What is the difference between arrears and advance stage payments? Arrears means the lender releases funds after a stage is finished and revalued. Advance means the funds arrive before the work is carried out. Arrears is the common model.

Why are advance products more expensive? Because the lender is releasing money against security that does not yet exist. Suffolk Building Society makes this point directly, and it is the reason the panel of lenders offering advance terms is small.

How many people are on Devon’s self-build registers? 2,640 across the ten Devon planning authorities at 30 October 2024, with Teignbridge at 755 and South Hams at 611.

Does East Devon treat registrations differently? Yes. It runs a local connection test and a two part register, and the council’s duty to permission plots attaches to Part 1 only.

Updated on 11 September 2026.

Sources

• MHCLG, Self-build and custom housebuilding data, published 5 September 2025
• East Devon District Council, self-build register frequently asked questions
• HM Land Registry, UK House Price Index, June 2026
• BCIS, construction industry forecast, 6 July 2026
• Suffolk Building Society, stage payments and self build mortgages
• Bank of England, Bank Rate, held at 3.75% on 30 July 2026

This article reports on how self-build finance is structured. It is not financial advice.

On 7 September 2026 Lloyds published its House Price Index for August, putting the average UK home at £298,468, down 0.2% on the month and 0.4% lower than a year earlier. That is the series’ first annual fall since November 2023, in a month when a 0.2% rise had been expected. Six days earlier Nationwide had published its own August index and said close to the opposite: prices 1.6% higher than a year ago, up 0.2% on the month after seasonal adjustment, with an average price of £275,465.

Both figures accurately describe the data each lender holds. Neither is the market. The two percentage point gap between them is inside the range these series routinely disagree by, and the more useful information sits below the Lloyds headline, in a regional table where Northern Ireland is up 6.9% and the South East is down 1.6%.

What did the two indices actually report for August 2026?

The Halifax House Price Index became the Lloyds House Price Index from July 2026 with the same methodology, so the series is unbroken under its new name.

Why do Lloyds and Nationwide disagree about house prices in August 2026?

Each index is built from the lender’s own mortgage approvals. Lloyds Banking Group and Nationwide lend to different customers in different proportions across different regions, so each sample carries the fingerprint of its own book. The price levels show the same effect: a gap of more than £23,000 between the two averages for the same country in the same month, entirely down to the mix of properties each lender finances.

Three further mechanisms widen the gap. Both indices are seasonally adjusted, but with different models, and a small modelling difference can flip a monthly figure from slightly positive to slightly negative. Both exclude cash buyers, who account for roughly a third of purchases. And both are measured at the approval stage in a thin market: HMRC counted 96,710 seasonally adjusted residential transactions in July 2026, down 2% on June and 1% below July 2025, and low volumes make monthly averages noisy and prone to revision.

Why does the regional split matter more than the national number?

Because the national figure averages places moving in opposite directions, and the result describes nowhere.

The pattern is north up, south down. Northern Ireland at +6.9% and the South East at -1.6% are more than eight percentage points apart, and the Lloyds national figure of -0.4% is true of neither. It fits the regional investment trends this site examined in August, where higher-yielding northern cities were already drawing capital that southern price levels had priced out.

Andrew Asaam, Lloyds Mortgages Director, said: “The housing market has been operating against a more challenging backdrop in recent months, with global developments feeding through to higher inflation and borrowing costs.”

What does a flat market mean for landlords facing the April 2027 tax rise?

A flat or gently falling market removes the cushion that used to forgive a thin yield. When prices rose several percent a year, capital growth did the work; in the southern regions Lloyds now reports as negative, the return has to come from rent.

Tax makes that harder from April 2027. The Government confirmed that income tax rates on property income rise by two percentage points from that date, a measure announced at the 2025 Budget. The rumoured National Insurance levy on rental income was not introduced. Alongside it, Making Tax Digital for Income Tax became mandatory from April 2026 for landlords and sole traders with qualifying income over £50,000, and extends to those over £30,000 from April 2027. Both changes point landlords toward yield arithmetic rather than price forecasting.

What are buyers weighing against each other right now?

Two things pulling in different directions. The Bank of England’s Money and Credit release on 1 September 2026 recorded 56,053 mortgage approvals for house purchase in July, the lowest since January 2024 and down from a revised 58,215 in June. Fewer competing buyers is good news for anyone still looking.

Against that, borrowing costs are not moving in the buyer’s favour. Moneyfacts figures for 2 to 3 September show the average two-year fix at 5.59% and the average five-year fix at 5.63%. The cheapest homebuyer two-year fix, 4.47% from Santander, sits more than a percentage point below the average. But Moneyfacts’ Rachel Springall also noted swap rates at 30-day highs and the 10-year gilt yield above 5.2%, its highest since 2008, the pressure that tends to pull best buys back up. Bank Rate is 3.75%, held on 30 July, with the next decision due on 17 September 2026.

Is a two point gap between indices actually news?

This is the case against the headline. A 0.4% fall on one index and a 1.6% rise on another describe the same market with two different rulers, and a two point difference is not unusual for these series. Nor does a first annual fall since November 2023 tell a buyer what a specific house in Exeter or Torbay is worth this month. The decision that matters for a landlord is the yield on a specific property against a specific mortgage rate and tax position. The decision that matters for a buyer is what comparable homes on the same street actually sold for, which Land Registry data will show two months later with no lender’s mix in the way.

Frequently asked questions

Which index is right, Lloyds or Nationwide?
Both, for their own samples. Each measures its own approvals with its own seasonal model and excludes cash buyers. The ONS and Land Registry index, built from completed sales, is the closest thing to a whole-market answer.

Does the first annual fall since November 2023 mean prices are now falling?
It means Lloyds’ national average was 0.4% lower than in August 2025. The same release shows Northern Ireland up 6.9% and the North East up 2.7%, so prices are falling in some regions and rising in others.

How much does the April 2027 tax change cost a landlord?
Income tax rates on property income rise by two percentage points, so £10,000 of taxable rental profit carries an extra £200 a year, and across a portfolio it adds up.

Should a buyer wait for lower rates?
The data does not support a confident answer. Approvals are at their lowest since January 2024, but swap rates and gilt yields were rising into September, which pushes fixed rates up. The next Bank Rate decision is 17 September 2026.

The August indices are best read for what they are: two lenders describing two customer bases, each with a different regional tilt, in a market thin enough for a fraction of a percentage point to separate a headline fall from a headline rise. The regional table carries more information than either national figure, and the sold prices in a particular postcode carry more than the regional table.

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