Design & build: Show us the money

The Block NZ 2012 winner Ben Crawford and his girlfriend Kylie are building their dream home. Share their proud moments and pitfalls here every week.

So here Kylie and I were, the conditional owners of an extremely challenging section that had been putting buyers off for years. We didn't know whether we could beat this piece of dirt into submission and build on it, nor did we have a firm grasp on the costs involved or have any finance in place.

But we did have a dream. A passionate vision for the home we could build on the site by transforming an overlooked block of land into something remarkable for us to live in for years to come.

Read more: Week one of Ben & Kylie's Brave New Build

I knew banks required a greater deposit when buying a section and I'd had a couple of home mortgages before, so was familiar with how that worked.

However we didn't know how a home loan would be structured for a new build, or how we were meant to arrange finance for a cost that was yet to be determined.

We had been lucky that our cheeky offer for the section had been accepted and we had a sizeable deposit from our combined savings, but this was uncharted waters for us.

To make matters more complicated, other than all of the unknowns surrounding the section, I was self-employed and our company had been trading for fewer than two years.

This meant my recent earnings history was light, which I knew would provide further uncertainty in the banks' eyes.


Ben on the section weighing up design ideas with perceived difficulties they present in getting mortgage.

We were in love with the section and the house design we'd come up with. It's an awful feeling being so emotionally invested in a project to find obstacles beginning to pile up, seemingly pushing the dream tantalisingly out of reach. I was actually scared to approach a bank for fear they'd say no and our dreams would be shattered at the first hurdle.

So rather than deal directly with a bank, I thought approaching a mortgage broker would be our best bet. A broker could shop our situation around all of the providers, meaning we would have a greater chance of getting the "yes" we were hoping for.


Native bush on section.

I contacted a mortgage broker I'd worked with previously. After an initial consultation and screeds of paperwork, a decision never came. There were never-ending questions and the combination between middleman and bank just seemed to be unnecessarily cautious.

It was when the broker told me four weeks into the process that he didn't work with Kiwibank that I considered going directly to them. Looking back, it seems odd as I do all of my personal and business banking with Kiwibank but we were so afraid of being told no, I thought a broker would be our best bet.


Milford Beach - a stroll from the section.

Our dealings with Kiwibank were refreshingly easy. Within 48 hours we had finance in place, divided between two loans.

The first was to enable the purchase of the section, pending a valuation on the land, and the second covered our construction costs and would be released as our build progressed.

However, before we could access any of the construction money, we would have to provide a fixed-build contract along with a valuation estimating the value of the house when completed.


Milford Marina - a stroll from section.

We were excited little campers when we were given the good news. We got the land valued immediately and it came in well above our offer, which eased a lot of pressure. Double-back-flips all round. Now we could technically buy the section and we had a ceiling for our total build costs. Phew.

But boy it was going to be tight managing our ambitious design with the realities of a restrictive budget and a complicated section. There were still so many unknowns presented by the land, meaning we were uncertain if we could actually build on the site the way we intended.

There was only one way to find out - fine-tune our design and talk to the council as well as as many engineers, planners and surveyors as possible. But that's next week's yarn.

Find out more about Ben and Kylie's dream home at ourdreamhome.co.nz.

Watch episode 1 of Ben & Kylie's Brave New Build below:

Video


Herald app users tap here to view the video.

For more information on the Kiwibank First Home Buyer's Guide visit: kiwibank.co.nz and search for "first home".

- Herald on Sunday

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