First Home Buyers are getting on the property ladder by purchasing a new home in a new property development. Purchasing a new build home is easier now for first home buyers and they are doing it with deposits as little as five percent.
New homes in some developments are selling for $510K – $560K and they are attracting first home buyers with deposits around the 10 percent mark though five percent is also not unheard of.
New property developments are rising in numbers now the RBNZ has slackened the LVR lending criteria on property development funding.
The latest Statistics New Zealand figures show building consents for new dwellings were up 16 per cent in 2014 over the previous year to 24,680, the highest level since 2007. Auckland was up 20 per cent for the year to 7595.
More developments will sell down to first home buyers (FHB) too after 1st April when the new higher HomeStart and KiwiSaver contributions kick in. Homes up to $550K will now be achievable for FHBs and while in Auckland that value is under the median – it’s above it in other areas around the country.
Living in a new build is not what everyone’s after. Purchasing a rental property elsewhere for example is another option which can be a better economic decision and get the buyer on the property ladder. This option allows the owner to rent in their area of choice while owning a property for investment. Over time the rental property may increase in value and the equity used to secure another property for investment or as an own home.