Build a house
Our guide to building your dream home.
A solution to meet every challenge
Building a home can be an extremely rewarding experience. Budget permitting, it gives you the opportunity to incorporate everything you’re looking for in a living environment – your preferred materials, floorplan, energy efficiency and aesthetic finish. Plus, at the end of it all, you can look at the finished product and say proudly, ‘we made this.’
But be aware, it can also test you and building requires careful planning. Here’s a quick outline of the key steps along the way.
Design and planning
The first thing to do is to work out your requirements, which is particularly tough when you’re building a home. On the one hand, you have one (and only one) opportunity to incorporate all your dreams and desires. But on the other, if you get too carried away you may not have enough money left for essential extras like driveways, fencing and landscaping.
Aside from questions on the type of house, you should consider our hints and tips to help you avoid common mistakes when designing and planning your build.
Selecting the right block
This part’s easy if you’re knocking down an existing house and starting again. But if you’re looking for a new patch of land there are many things to consider. For example:
- Is the location, size, shape and slope of the land conducive to the design you have in mind? Will it be easy to build on, or add significantly to the costs?
- Are there any easements or impediments associated with the block?
- Is the soil okay (it pays to have it tested before purchasing)?
Picking the wrong block can add significantly to the building costs and like any home purchase, you should always consider the neighbourhood before you buy.
With your design finalised and costed, you’re probably going to need to finance the build, so it’s important to work out your budget and understand how much you can afford to repay – before you sign on your dream design.
The joy of completing your dream build will disappear very quickly if over-spending forces you to make big sacrifices in other areas of your life. So if it’s going to be too tight, or there’s no contingency for unexpected costs, you might want to reconsider the design.
Choosing the right home loan is easy when you’re building. Construction loans are tailor made, allowing you to draw down funds at approved stages of the build so that you only pay interest on the amount you’ve borrowed at any point in time.
Because the loan is progressively funded, a variable rate is the only option during the construction period. But there’s still plenty of choice when it comes to variable rate loans, and once the build is finished you can swap to a fixed rate if you wish.
It’s easy to forget insurance in all of the excitement of taking possession of your brand new home, but now is not a time to be taking unnecessary risks. Building insurance is actually a condition of your loan approval, but you should also make sure you have home insurance in place as soon as the property becomes your legal responsibility and contents insurance before you move in.
This is general advice only and doesn’t take into account your objectives, financial situation or needs. Conditions, fees and lending criteria apply and are available on request.