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Ensuring your building plans don't remain on pause

7 April 2020

It is an unprecedented time in New Zealand. The economic impact of COVID-19 is far-reaching, and life post-lockdown will undoubtedly look very different.

While building a new home might seem out of reach in the current climate, there are certain measures available to ensure original plans are realised, says Generation Homes chief executive Kevin Atkinson.

“We appreciate that households are concerned about future finances in the wake of the COVID-19 pandemic, and perhaps questioning their home building idea,” says Kevin. “However, there are still opportunities to make it a reality. For example, people might consider reducing their overall footprint or foregoing certain features to reflect changing priorities.

“Many people feel that high costs and budget blow-outs go hand-in-hand with building a new home – but this doesn’t have to be the case. Working with a company like Generation Homes means you can be assured of fixed budgets and controlled timeframes.

“When building new you can also choose a layout that fits your exact needs. No matter how big, or small, we can configure the end result to your individual needs and budget.”

The lockdown period provides an opportunity to limit expenses and change spending habits in the long-term, adds Kevin.

“We have all had to come to terms with a new normal. For some households, the current situation is an opportunity to reconsider priorities. As a result, the prospect of a new home might not be out of reach.”

Below are some things to consider when contemplating home building:

CONSIDER KIWISAVER

Generation Homes is a big fan of the KiwiSaver HomeStart grant, which enables young Kiwis to get a foothold on the home ownership ladder. If you are a first-time homebuyer or a previous home owner, and you have been making regular KiwiSaver contributions for 3-5 years, you may be eligible for a grant of up to $10,000.

For further information head to the KiwiSaver Website

You can also read how Generation Homes’ customers used KiwiSaver:

Given the current economic environment, some people might be concerned about potential drops in their KiwiSaver balances. First home buyers planning to put their KiwiSaver funds toward a deposit in the near future are advised to talk to their provider about whether to switch to a cash fund. This locks your investment into a low risk fund largely unaffected by the sharemarket.

Tom Hartmann, editor of the Sorted website at the Commission for Financial Capability, says: “The key question KiwiSaver members should ask themselves right now is ‘How soon do I need that money?’ If the answer is sooner rather than later, they should talk to their provider about whether they should switch to a cash fund.” READ MORE

MAKE USE OF LOW-INTEREST RATES

The Reserve Bank of New Zealand has cut the official cash rate to a record low of 0.25 percent for at least 12 months. The resulting low interest rates means now is a great time to secure a home loan.

Bank of New Zealand is offering a fixed mortgage rate of 3.05 percent for 18 months, meanwhile Heartland is offering 2.89 percent for 12 months.

LOOK LONG-TERM

Traditionally, real estate has proven to be a solid investment.

Financial research agency Canstar says, “Ultimately, pandemic or no pandemic, if you do your sums and treat the purchase of a first home as you should your KiwiSaver account, as a long-term investment, regardless of flu bugs, your first step on the property ladder should be a big step to a healthy financial future.”

Building a new home provides an opportunity to invest in a tangible asset, as reinforced by Bayleys residential and projects divisional manager Justin Haley.

“Through adversity there is always opportunity,” says Justin, speaking to the Otago Daily Times.

“In times of uncertainty you definitely find people gravitate towards tangible assets, we have seen that not only through the GFC but also after the earthquakes sequence.”

Generation Homes’ Kevin Atkinson says the company’s fixed price, on-budget guarantee provides added peace of mind.

“We provide affordable, architecturally-designed houses to Kiwis without compromising on quality, design or innovation,” says Kevin.

“Every one of our customers enjoys the security of a fixed-price contract and an individually-tailored building schedule. Building doesn’t need to be a stressful, time-consuming exercise where costs keep mounting.”

GENERATION HOMES' LOCKDOWN TIP:

The current situation provides a good opportunity to start collecting ideas and mood boards for your next home. Take a look at our Pinterest page for inspiration - CLICK HERE.

Meanwhile, we are still open online and happy to help. Despite our show homes and offices being closed at the moment, our teams are all set up and working from home. On our website, you can explore our designs from the comfort of your own home with our online video tours.

If you have any further questions, please don’t hesitate to call or email one of our sales consultants.