There is a boost for people able to build their own home, with our biggest mortgage lender today offering a sweetener.
ANZ bank revealed to 1 NEWS it will introduce a floating rate to borrowers who build a new home, or are in the process of building one, of 1.68%.
“This is our way of helping to increase the supply of houses to make it cheaper for customers who are looking to build new houses across the country,” ANZ’s Ben Kelleher told 1 NEWS.
Despite being on offer for two years, it’s floating, which means it may rise as other interest rates rise.
Although fixed rates have been low, floating rates have remained much higher.
Economist Cameron Bagrie says it’s about time there’s more competition in the market and moves to bring the “eyewatering” floating rates down.
Apprentice builder Daniel Cleminson says he’s found the high floating rate while building tough.
“When you're paying interest only, the interest rates are actually a lot higher than what the lowest ones are at the moment so we were actually quite surprised at how much they did affect us,” the Dunedin man said.
“If that got knocked back, it'd make a huge difference to us.”
The Government has been encouraging investors to build new homes rather than buy up existing ones, as the pressure in the market and on first home buyers continues.
But the rising cost of building materials, land supply issues, and access to funding has held some construction back.
Cleminson says the hardest part of the whole process has been getting money from the bank.