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jody@zebramortgages.co.nz

Turnkey Homes

Land and Build Packages also known as Turn Key builds

Since the 80s, turnkey homes have become more popular and although they can often be a little more expensive than a regular construction loan, where you engage a builder to build a house for you, they can have advantages over overseeing a build yourself.

Advantages

The main advantage is you don’t have to wait 8 months the house to be built. Think about it, if you approach an architect to build a house for you. By the time the consents come back out of Council, and the time it takes for the builder to build your home, it could easily take the thick end of a year to complete a whole project.

You also then need to engage a builder. Most NZ building companies are rather reputable, however things can still go wrong. This adds stress to the situation. You then need to continually arrange payments until the property is complete. With a turn key, depending on the builder, there is normally a small deposit required up front before the build starts and then no further funds are required until the build ends.

The process is also a lot less complicated as the builder completes most of the steps required to build the property, unlike a construction loan.

You also get to see the finished product before it is complete. Sometimes it can be hard to be truly satisfied with a property when you can only see it on paper. Buying the existing product removes this stress.

So how does this relate to the banks?

Outside of the normal lending criteria to purchase any house when lending is required, the only condition required when building a Land and Build package is to have a registered valuation showing the final value of the house. Banks may also be a bit hesitant with a construction loan and they may want to vet the builder. They don’t want to be in a position where they advance a lot of money for a new build and builder goes under. Effectively with a turn key property, the builder carries the bulk of the risk.

In summary, if you are looking for a loan for a turnkey property we can assist. As the house will also be new, you could qualify for the HNZ Home Start grant, and even a Welcome Home Loan