What to consider when buying your first home

Investing in your first home will likely be the biggest purchase of your life, so preparing for it in advance takes you a long way. Real estate investments in New Zealand have been one of the most proven ways to generate wealth but for most people, getting there could be a daunting task. So here are some tips to plan, so that when the day comes, you are ready to make that big purchase! 

Deposit – start saving early

Most banks in New Zealand want a 20% deposit but there are a few that even provide a mortgage for as low as 10%. The catch is that the deposit is quite proportionate to the mortgage deal you get. So, pick a budget and start saving – and generate close to 20% of your budget if not more for a good mortgage deal.


Boost your savings with KiwiSaver. If you are over 18 and live in New Zealand and have been in Kiwisaver for over 3 years, you may be able to withdraw most of your Kiwisaver funds and use it towards your first home deposit. More info on KiwiSaver First Home withdrawal here.

Build a home or buy a house

There are few different ways to purchase your first home, but you will have to decide whether you want to build a new home or purchase an existing one. Most first home buyers will have a limited budget and will look at purchasing an existing house – but with a small budget in a competitive market, finding a good house becomes hard. Building your first home, where you can customise based on your budget, may be a better option for you. Look out for house and land packages – there are some builders who also have first home packages available – you will be able to build your dream home within your budget.

Hidden costs

Purchasing your first home may not be simple and straightforward, but it can be a smooth process if you budget properly. There are going to be extra costs, and the whole process will most likely end up costing more than you think. So do your research and factor in these costs:

  • Conveyance and legal fees – $1,000 to $3,500
  •  Mortgage arrangement fee – $500
  •  Valuation fees – $1,000
  • Building inspection – $500 to $750
  • Furnishings – $3,000 to $5,000 (buy used furniture to save costs)

Consider talking to a mortgage broker

Mortgage brokers are experts at finding the best mortgage deal for you and help you save money as well as make the process a whole lot easier. So, look for one in your city and talk to a few before deciding on one. Some of the ways they can help are:

  • Guide you on how much you can borrow
  • Mortgage calculations – break down how much you will pay weekly, monthly and in total.
  • Help with budgeting

Finding and buying your first home can be a wonderful experience if you are well-informed and are practical with your decision making. So just keep doing your research till you feel prepared to take the next step. 

We hope you find the dream home that you are looking for!