Building a new home can be one of the most rewarding financial and personal decisions. You get to design your own space that maximises your family's needs and wants. However, it’s a complex process with many potential pitfalls. NZ Mortgages has helped a large number of Kiwis build their own homes, and we've seen it all. Avoiding these common mistakes can save you time, money, and stress.
1. Underestimating the Budget
One of the biggest mistakes is underestimating costs. Even with a carefully prepared budget, when building on a progressive build structure, unexpected expenses are almost inevitable. From minor adjustments in materials to labour costs, prices often fluctuate. It’s wise to set aside a contingency fund—10-20% of your initial budget is a good rule of thumb. This cushion will help you navigate unexpected costs without derailing your finances.
Unsure on what a progressive build is? Read our blog on the differences here.
2. Skipping the Research on Builders and Contractors
It's vital to work with a builder that you trust. Everyone in New Zealand seems to know a builder, but it is best to still do your due diligence when choosing someone to create your dream home. Look for a builder who understands your vision and has experience in projects similar to yours. Check reviews, visit completed projects, and ask for references. Choosing the right builder will reduce stress, prevent communication issues, and help avoid costly errors.
3. Failing to Plan for Delays
Everyone has heard the phrase; 'We'll be in for Christmas!'. Unfortunately, construction delays are common due to factors like weather, supply chain issues, and regulatory checks, especially in an industry in the final stages of recovery from COVID-19. While some delays are out of your control, building a time buffer into your schedule helps you stay on track and keeps your expectations realistic. Make sure your construction contract includes timelines and keep a healthy relationship with your builder or construction company, so you’re covered if things run late.
4. Ignoring Future Needs
When building, it’s easy to focus on immediate needs. However, consider future needs as well. Will your family be growing? Do you need a space that could serve as a home office? Is there potential to expand the home in the future? Building with flexibility can save you from costly renovations down the road.
5. Not Including Key Upgrades
Some upgrades are much easier and more cost-effective during the building phase than after completion. Think about future-proofing the home with energy-efficient windows, high-quality insulation, and durable fixtures. These initial investments can save money on repairs and reduce energy bills over time.
6. Overlooking Outdoor Spaces
Outdoor areas are often left until the last moment, yet they add immense value and functionality to your property. Plan for landscaping, driveways, decks, and other exterior elements early in the design process. This foresight will ensure that your home’s outdoor areas are just as functional and inviting as the interior, and won't leave your budget stretched just to get a lawn or driveway in. If you aren't fussed about you outdoor spaces straight away, here's how to secure finance to do projects outside further down the track.
7. Forgetting to Review Your Contract
The contract with your builder or contractor should be clear and detailed, covering every part of the project, from timelines to materials used. Always review the contract carefully and consider getting legal advice if needed. This will help ensure that there are no surprises during the build and give you recourse if things don’t go as planned.
Start Building with Confidence
So, there you have it. By avoiding these common mistakes, you’re hopefully on the path to a smoother, more enjoyable building process that will get you your desired results on-time, and on-budget (touch wood!). Our experienced mortgage advisers are always here to guide you through structuring your construction loan and making the most informed decisions every step of the way.
For expert advice, connect with our team today at NZ Mortgages or give us a call on 0800 100 300. We’re here to help you bring your dream home to life, one informed decision at a time.
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