Can an owner build their own house by direct labour?
Yes; the owner may appoint themselves as the builder if they believe they are competent to conduct that role and sign the Certificate of Compliance (Undertaking by Builder). As the builder, they are responsible for compliance with the Building Regulations. They must appoint an Assigned Certifier to inspect the works during construction, and sign the Certificate of Compliance on Completion.
If an owner decides to opt out of the statutory Certificate of Compliance on Completion, they must declare that they understand their statutory requirements, and that they will ensure that the dwelling/extension is designed and constructed in accordance with the relevant Building Regulations requirements.