We’ve all seen the headlines of the cost of building and new builds going up. In this blog we outline some of the reasons for the increase in cost and give some tips of how to deal with this when working to a budget. The demand for housing remains strong and a perfect storm has been created with rising costs of land prices, a shortage of labor, and the rising cost of building materials due to the constraints on the global supply chain (prices for Gib has increased by 15% in the last 12 months!) Because of this, banks are now factoring in 10% contingencies to assist with these rises, and developers and builders are putting clauses of price increases in their contracts. Also contributing to the increasing cost of building is New Zealand signing up to be carbon neutral by 2050. As a result of this, New Zealand building standards are due to increase. The Ministry of Business, Innovation, and Employment (MBIE) are proceeding with updates to acceptable solutions and verification methods to make new builds warmer, drier, and healthier. The effective date for the new acceptable solutions and verification methods was 29 November 2021 with a transition period of one year ending on 3 November 2022. The ballpark figure will see about a 5.2% increase in build costs. Although this all sounds very negative, it proves the point that having people on your team with the expertise that Summit Mortgages has is the best way to build in 2022! Research is key, and we do it for you! The first step is to find out your borrowing power. As mortgage advisers, we will work with you to figure out what you can afford, go through your savings plan, KiwiSaver, uncover your expenses that may be holding you back or the make the difference of being able to borrow $10,000 more and achieve your homeownership dream. We have the advantage of solid relationships with various lenders, meaning we can find a lender where your individual situation fits their policy. We see far too often where people approach the banks and get told no, and then feel deflated and put their plans on hold. We are here to assist you with your goals, and offer expert advice on reaching them.

With all the current changes and delays we have had clients’ approvals expire, and then find themselves in a position where they no longer service or meet the approval conditions. This is where having a mortgage adviser is absolutely beneficial; having relationships with the lenders and knowing the policies means you may not fit in your current bank’s box, but may fit in another. This was the exact scenario with these clients and they have now settled on their section and waiting for their dream home to be built!
Our Real Estate agent put us on to Summit Mortgages. We had Olivia helping us and she has been absolutely amazing. As first time buyers, with what’s happening in the market things haven’t been easy, but she has been great at getting us through to where we are and talking us off the ledge a few times. Couldn’t recommend Olivia and Summit Mortgages more.
-Gareth

Olivia Osborne- Mortgage Adviser, Financial Adviser, FSP1001299
Being a Mortgage Advisor appealed to me as I love helping people! Whether it being their first home, building a new property, expanding their family and needing a bigger home or investing - all are exciting changes in life. It's great being able to help to put clients at ease through what can be a stressful process! Before joining the Summit Mortgages team I studied a Bachelor of Social Sciences at Waikato University majoring in Geography and Sport and since then I was in the banking industry for 4 years. I grew up locally on a dairy farm and have since been through the first home buyers journey and live in Morrinsville. In my free time I enjoy sport and the outdoors.
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