DID YOU KNOW THAT YOU CAN BORROW MORE IF YOU’RE BUILDING A BRAND NEW HOME THAN BUYING AN EXISTING PROPERTY?
03 Sep 2015
Changes announced by the Reserve Bank in December 2013 make new residential construction loans free of the LVR restrictions. That means the 20% deposit rule no longer applies to new homes.
Provided you can afford the repayments and meet general bank lending requirements, you could build your new home with just a 10% deposit, maybe even less. Here’s what it could mean to you: With a deposit of NZ$75,000 you may be able to buy an existing home valued at up to NZ$375,000. This meets the 20% deposit rule under the LVR restrictions. With a deposit of NZ$75,000k you may be able to build a brand new home with a combined land and build cost of up to NZ$750,000. That’s with a 10% deposit under new residential construction exemptions from LVR restrictions.