A kitset shed house is a cost-effective and flexible housing solution, combining the strength of a shed with the convenience of a prefabricated home. Whether you’re building a primary residence, a holiday retreat, or a secondary dwelling, securing the right financing is essential. Below, we explore the best financing options available in New Zealand and key considerations to ensure a smooth process.
1. Home Loans and Mortgages
Traditional home loans can be an option for financing a kitset shed house, but lenders require the structure to meet New Zealand’s Building Code and be classified as a permanent dwelling. To improve your mortgage eligibility:
- Ensure compliance with all local council regulations and obtain the necessary building consents.
- Work with a trusted provider like No Bull Sheds to present professional plans and cost estimates.
- Provide evidence of the long-term property value and sustainability to your lender.
2. Personal Loans
If your kitset shed house does not qualify for a home loan, a personal loan may be a flexible alternative. While interest rates are typically higher than mortgage rates, personal loans are useful for smaller projects or staged builds. This option is ideal if:
- Your funding needs are moderate.
- You plan to build in stages rather than all at once.
- You have a strong credit profile that can help secure favorable terms.
3. Construction Loans
A construction loan provides staged funding as your kitset shed house progresses through various build phases. This is a great option for larger projects, as payments are released based on construction milestones. Lenders typically require:
- A fixed-price contract with a licensed professional.
- Verified council consent and regulatory approvals.
- Proof of land ownership or a signed land purchase agreement.
4. Leveraging Home Equity
If you already own property, you may be able to use your home equity to finance your kitset shed house. This could involve refinancing your mortgage, applying for a home loan top-up, or using your existing property as collateral. The benefits of this approach include:
- Lower interest rates compared to personal loans.
- The ability to consolidate your financing into one loan.
- Access to larger funding amounts with better repayment terms.
5. Agricultural and Business Loans
If your kitset shed house will be located on a farm or used for business purposes, agricultural or business loans may be an option. Some lenders provide financing for farm buildings that double as residences, particularly if they support a working business. This route is worth considering if:
- The shed house will be part of a larger agricultural operation.
- It contributes to a business or income-generating activity.
- The lender acknowledges the project’s economic viability.
Key Takeaways
Successfully financing a kitset shed house in New Zealand requires careful planning, compliance with building regulations, and an understanding of available funding options. By working with us at Waikato Sheds, you can ensure a high-quality, durable shed house that fits your financial strategy.
If you need expert advice on building your kitset shed house, contact Waikato Sheds today to explore the best solutions tailored to your needs. And if you’re looking for support with financing your shed project, get in touch with our friend Ben Presling, finance advisor. Ben can help you find the right funding options to make your shed dream a reality. Reach him on 022 265 6575 or ben.presling@advicehq.co.nz.
If you need expert advice on building your kitset shed house, contact Waikato Sheds today to explore the best solutions tailored to your needs.
