Essential Tips for Buying a Home: A Comprehensive Guide

Buying a house or apartment is a significant financial decision. To ensure you maximize your investment and minimize stress, our comprehensive house-buying guide provides 40 essential tips. Discover everything you need to know about the home buying process, including key considerations and expert advice.

New Zealand’s Property Market:

New Zealand’s property market has experienced a surge in prices since 2007, reaching all-time highs in cities like Auckland, Hamilton, Wellington, and Queenstown. Despite the impact of COVID-19 in 2020, house prices continued to rise due to high demand and limited supply. However, recent legislative changes, such as restrictions on foreign ownership and uncertainties surrounding capital gains tax, have led to a cooling off in prices. This provides an opportunity for buyers to carefully consider their options and prioritize long-term affordability.

Focus on Financial Security:

Instead of succumbing to market hype, it is crucial to prioritize financial security when buying a home. It is impossible to predict future house prices accurately. Therefore, our guide encourages buyers to focus on affordability and avoid overextending themselves financially. By taking a sensible approach, buyers can minimize the risk of excessive debt and ensure a comfortable journey up the housing ladder.

Mortgage Considerations:

A mortgage is often the largest debt an individual will undertake and can span a significant portion of their adult life. Even small differences in borrowing amounts can have a substantial impact on daily life. Our guide addresses this by offering insights into the mortgage process and providing information on the best deals for homeowners with a 20% deposit or those considering refinancing.

Get the Biggest Deposit Possible:

Maximizing your deposit percentage can lead to better mortgage deals. Our guide explores the options for first-time buyers, including utilizing funds from KiwiSaver, a government initiative, and the HomeStart Grant, which provides financial assistance to eligible individuals.

Budget Properly for Your Purchase:

Buying a property involves various costs beyond the purchase price itself. Our guide provides a breakdown of fees and expenses to consider, including conveyancing and legal fees, mortgage arrangement fees, valuation reports, building inspections, removal costs, potential repairs, and budgeting for essential furniture and items.

Conveyancing/Legal Fees: Simplifying the Property Buying Process

Conveyancing, the legal process of property transfer, ensures a smooth ownership transition from the seller to the buyer. Here’s a breakdown of the steps involved:

1. Verification: A lawyer confirms the property’s ownership and checks for any legal complications.
2. Contract Examination: A lawyer reviews the draft contract and associated documents, highlighting any concerns to the seller’s lawyer.
3. Thorough Searches: Various legal searches are conducted to uncover hidden issues, such as potential road developments or previous building settlements.

Conveyancing fees typically start at around $1,000, covering all necessary land registry searches. In areas like Christchurch and Wellington, costs may be higher due to earthquake-related considerations. Your lawyer will investigate any property restrictions, ensuring you have a clear understanding of your purchase. If the property has a history of issues, additional investigation may increase conveyancing costs. The service concludes when you collect the keys from your lawyer upon taking possession of the property. For more details, refer to our comprehensive guide on conveyancing and property lawyers.

Mortgage Arrangement or Establishment Fee: Applying for a Mortgage

Certain banks and credit unions charge a fee for mortgage application, arrangement, or establishment, in addition to the interest rate. Consult our mortgage interest rate guide to identify lenders with and without such fees. Please note that this fee is non-refundable, even if you decide not to proceed with the mortgage. It covers the paperwork involved in processing a mortgage.

Lenders may charge anywhere between zero and $500 for this fee. As each lender has different policies, it’s advisable to inquire early in the process to plan your budget accordingly.

Valuation Report: Determining the Property’s Value for Making an Offer

While optional, obtaining a valuation report is recommended to accurately assess the property’s worth and support your offer. Unlike websites like or, which provide CV valuations, a detailed report incorporates current market conditions and local expertise, offering a more informed perspective.

Property valuations typically range from $500 to $1,000. The actual cost depends on factors such as house size, location, and urgency. Search for companies specializing in property valuation in your area, consider reviews, and request quotes to ensure the best outcome.

Pre-Purchase Home Inspections: Ensuring Property Condition

To avoid purchasing a problematic home, it’s prudent to invest in a comprehensive property inspection report. Beyond leaky buildings, New Zealand properties can face issues like meth contamination. Look for a building inspector whose report includes moisture checks, leaky home checks, thorough inspections, electrical and plumbing assessments, cross-checking with council records, and repair estimates.

The cost of a typical survey ranges from $500 to $2,000, depending on factors such as property location, size, and optional additional tests. Consider budgeting for two or three inspections to account for potential purchases that may not proceed.

Removal Costs: Budgeting for Moving Belongings

Unless you have minimal belongings that can fit in a car or have access to a friend’s or family member’s van, you’ll likely need to hire a removal company.

Moving costs vary based on the number of items and distance. For small moves within a town or city, budget around $200 to $500. For long-distance moves or when transporting a substantial number of belongings, expect costs of $1,000 or more.

Budgeting for Unexpected DIY Repairs

As a new homeowner,

you may encounter unforeseen DIY repair needs, such as plumbing, roofing, or painting. It’s advisable to allocate funds for immediate touch-ups or fixes, ensuring your property is in good condition when friends and family visit.

While it’s challenging to estimate the exact amount required, having a spare $1,000 can cover initial touch-ups, including paint, brushes, and professional services like plumbing if necessary.

Budgeting for Decent Furniture and Essential Items

If you currently reside in a furnished flat, you may need to acquire additional furniture and essential items when moving to a bigger property. Consider investing in long-term furniture rather than settling for temporary pieces, as priorities can shift once you become a homeowner.

Furniture costs can vary widely, but budgeting around $10,000 for new items like beds, mattresses, a lounge suite, and tables is a good starting point. Opting for retro or vintage items can significantly reduce costs.

Plan your budget accordingly, considering the expenses outlined above. By accounting for these costs, you can make informed financial decisions and ensure a smooth transition into homeownership.

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