Not one's own terrace: dug hole around it (8)
I believe the answer is:
borrowed
'not one's own' is the definition.
(borrowed from someone else)
'terrace dug hole around it' is the wordplay.
'terrace' becomes 'row'.
'dug hole' becomes 'bored' (bore can mean to drill a hole).
'around it' is an insertion indicator.
'row' put into 'bored' is 'BORROWED'.
(Other definitions for borrowed that I've seen before include "Undue extension of life" , "Took temporarily" , "Bored row (anag.)" , "Took a loan" , "Procured on loan" .)