The price of housing in New Zealand is rising. We are seeing huge increases in the cost of purchasing property all around the country. Auckland prices in particular are sky-rocketing. People are beginning to look to look further afield, searching for cheaper house prices, causing the price of property to rise around the country.
Notably, these price increases are making it difficult for first homebuyers to get a foot on the property ladder. Beyond this, media speculation and news pieces on the topic paint a grim picture, this adds fuel to the fire, causing panic. This panic can be compounded at high stress auctions seeing prices soar way above the expected sale price.
We’ve compiled a list of tips below that could help you beat the New Zealand housing crisis:
1) Investigate all your options
One of the first decisions you will make when considering the purchase of a new home is whether to buy existing, or build new. There are advantages and disadvantages to both, but the disadvantages of buying aren’t always obvious.
Many modern features are standard on new homes, but older homes may need to be retrofitted to include these. Once you add this cost to your purchase price, the amount you will have to spend will increase dramatically.
You will need to consider whether the house you are looking at contains the following: Security systems, double glazing, energy efficient appliances, a dishwasher or space for one, indoor-outdoor flow, a floor plan that takes into account the position of north, aluminium door and window joinery, security window stays, multiple power points per room, bathroom extractor fans, multiple telephone jacks, hard-wired smoke detectors, garage door openers with remote control and internal access garages.
So many of these features we take for granted, yet these features make a huge difference to how we live in our home.
You will also need to investigate the potential health hazards of buying an existing home. Some homes house harmful products that are no longer used, these can have serious health ramifications or can be incredibly dangerous – it won’t just be your wallet that gets hurt. Asbestos was used extensively in older homes as were lead based paints. Both of these require considerable work to fix and can cause serious health issues. How watertight is the home you are looking at? Homes built under older building codes didn’t have to meet the same stringent guidelines that a required today.
We also need to consider who used the house we are looking at buying before us. Was it used to cook methamphetamine? Poisonous toxins from the cooking process remain in the building long after the perpetrators are gone. They seep into the structure of the building, leaving no option but to tear the house down.
Building a new home is often considered a stressful process, but at Signature homes, we believe the whole process should be not only stress free, but also enjoyable.
It should certainly involve a lot less stress than fixing some of the above issues.
2) Consider looking out of town
When choosing a location to buy or build, there are many contributing factors that can affect your decision. For some people, living in a specific area is more important than for others who can afford to be more flexible with where they decide to live. If being more flexible is an option for you, consider looking further afield. Perhaps there is somewhere nearby that you hadn’t considered because it’s a slightly further commute, but it might actually only add 15 minutes to your commute time. School zones play an important part in pushing up prices. Do your research on other schools in the same city; it may be that there are other comparable schools in different areas that can offer the same learning environment for your children without the big price tag for the location. This would allow you to look in different areas giving you more options.
Perhaps there is an up-and-coming area that is cheaper to buy in because it isn’t in a popular zone. If you have the option to relocate easily with your career, considering extending your search for property to different cities or towns can yield better result.
Finding the right area to live in is a balance between your wants and needs and your budget. The more options you can give yourself, the more likely it will be that you can find the right property for the right price.
3) Buddy up/rent out a room
Unconventional living arrangements are becoming increasingly conventional. It isn’t uncommon in New Zealand now to have several generations of a family living under one roof. This opens up a huge amount of possibilities for pooling resources to get on the property ladder. Are you looking to buy you and your family a home while your parents are looking to downsize? Could you combine your resources and purchase a large house with space for you all under one roof?
Alternatively, do you have friends also looking to get on the property ladder? Could you combine your resources and purchase a property together, living as if you were flatting together, but instead you own the house between you. This could be a good stepping stone to get into the market. Another option is to buy a property and rent out one of the rooms that you aren’t using. This can help you cover the mortgage repayments every month making such a large purchase more economically viable.
These are all great ideas to provide you with an opportunity to buy property, however we do suggest you choose who you decide to live with carefully and get a thorough contract drawn up incase a disagreement occurs.
4) Do your research
It is important when looking to buy property that you thoroughly research all your options. There are a couple of great Kiwi Saver schemes out there for people who fit the criteria. New Build Finance also offers affordable finance and low deposit loans to Signature Homes customers. They can offer loans from as little as 5% deposit and once your deposit is paid, you don’t need to spend a cent on repayments until you move in to your brand new home.
Check out New Build's Home Loan Qualifying Calculator here.
By doing your research thoroughly you open yourself up to more opportunities that could allow you to purchase property more easily.