People are still renovating their homes despite the property market cooling off. Photo / Getty Images
People are still renovating their homes despite the property market cooling off. Photo / Getty Images
Homeowners are sinking up to $650,000 into renovations and one boss says the market is going ''gangbusters'', with people preferring to stay put amid falling property prices.
The Master Builders Association of New Zealand said its members were also experiencing strong demand from renovators while inquiries for new-home builds haddropped.
Builderscrack, an online marketplace for tradies, has been at record levels for more than a year and that had only slowed slightly in the last couple of months.
Maintain To Profit founder Mark Trafford said the renovation market was going ''gangbusters''.
He said all of its franchises, from Rodney to the Bay of Plenty and Wellington, had work for three to six months or beyond. One client had spent $650,000 on a complete renovation.
''The market is really good. People are not selling, now that the housing market is cooling. Rather than buying or selling, they are looking at spending some money on their own homes.''
Trafford said there was a lot of doom and gloom with the interest rates but that had not transpired into renovations.
However, he acknowledged there were challenges with building materials and delays.
''That hasn't changed, you have to be working with a company that has good relationships with suppliers.
''You need to have all your ducks in a row, the builder needs to be competent, and going for the cheapest builder is not necessarily the best idea.''
Jeremy Gray, marketing manager at tradie marketplace Builderscrack. Photo / Supplied
Jeremy Gray, marketing manager at tradie marketplace Builderscrack, said renovation demand was at record levels from September 2020 to April 2022.
''That had only slowed a little bit in the last couple of months.''
Gray said last winter there was an extraordinary level of demand for bathroom renovations while kitchen renovations and home office conversions of garages and spare rooms were popular.
''People were looking to utilise space in their homes for more practical purposes. We saw some really interesting renovations of loft spaces, conversions of shipping containers and sheds into studios and craft rooms.''
In summer, decks were being built to create indoor/outdoor flow.
''You name it, we have seen it.''
Budgets varied, he said, and a good rule of thumb was to work back from the desired outcome and consider the surfaces that were going to be renovated.
''We see people renovating specific rooms for as little as $2000, all the way through to $200,000 plus renovations. Over the last couple of years we have seen people investing heavily in creating comfortable, liveable spaces that create a sense of comfort and easy living.''
New Zealand Certified Builders chief executive Malcolm Fleming said its members were reporting full-forward workloads for the next 12-24 months, however new inquiries about home builds and renovations were easing.
Louis Davis, of Tauranga Builders, said his workload was still steady on the renovation side.
''The renovations are still going really well. I think people are wanting to stay put at the moment.''
Master Builders Association national vice-president Johnny Calley, of Tauranga-based Calley Homes. Photo / Supplied
Master Builders Association national vice-president Johnny Calley, of Tauranga-based Calley Homes, said people were nervous about the economy and what was going to happen in the next 12 months.
''So I guess the safest or most conservative approach is to stay put and renovate. Inquiries for renovations are stable and that is bucking the trend of new builds. Those inquiries have dropped.''
A BNZ spokesman said every year it helps thousands of Kiwis buy, invest in, and renovate their homes.
Renovations had always been a popular option for customers to make their home just how they want it to be.
''Our lending for renovations has remained approximately the same. All lending is assessed on a case-by-case basis and based on a variety of factors, including a customer's overall debt position and the value of their property.''
A Kiwibank spokesperson said home renovations and improvements like double glazing, replacing the kitchen and adding in another bathroom were common reasons a customer might request additional lending on their home loan.
As a responsible lender, it needed to assess its customers' ability to repay and how much equity they currently had in their property.
''One important consideration for customers whenever they are looking to borrow additional funds on their home loan is to consider the cost over the life of the loan for these additional funds and whether they can borrow these funds over a shorter loan term to save on interest.''
A Westpac spokeswoman said customers topping up their mortgage to finance a renovation would need to complete a new lending application, and usual lending criteria would apply.
Tips for major renovations
Move out
* It's always the best policy to live elsewhere during a renovation. Families living on-site hinder the project, which as a result takes longer to complete even when there aren't materials shortages. * If possible, factor living elsewhere into your budget and move out. Find an Airbnb or live with family or friends. Even a caravan or something similar is going to be less stressful.
Time out * It's a good idea to spend as little time as possible in the house. * Take time out as much as you can, even if you are just making better use of your backyard for things like meals, coffee, homework and play. * Take more walks, do day-long picnics on the weekends and make extended visits to family; even take regular weekends away. * Getting out and about will help you de-stress.
Designate activity zones * Be diligent about health and safety. Designate areas for play, living and working and make sure the whole family understands the boundaries. * Some renovations will face delays due to building material shortages, however a significant positive from living through a renovation is that you get to take pleasure in the milestones. - Source Maintain To Profit founder Mark Trafford
