Construction loans and new builds
Building a new home or buying a house and land package works differently from buying an existing home. We arrange lending that fits your build and help you avoid surprises along the way.
A construction loan pays your builder in stages as your home is built, rather than as one lump sum. You usually only pay interest on the amount drawn so far. New builds can also qualify for different lending and deposit rules from existing homes, which is why they’re popular with first-home buyers in growth areas like Takanini and Drury.
Reviewed by the Moneyplant mortgage advice team, Papakura · Updated September 2026
How we help
- Before you sign: we check your building contract, timeline and price will work for lenders.
- Find the right lender: construction lending policies vary a lot between banks and non-bank lenders.
- Manage progress payments: we help coordinate drawdowns with your lender, builder and lawyer.
- Protect it: set up insurance so your home and family are covered from the start.
Ways to buy new
- Build contract: you own the land and sign a contract with a builder.
- House and land package: the land and build are bought together from a developer.
- Off the plans: you commit to buying a home before it’s built, and pay the balance when it’s finished.
- Turnkey: you pay when the finished home is handed over, ready to move in.
Each has different timing and lending requirements, so talk to us before you sign anything.
How progress payments work
The lender releases money in stages, such as the foundations, framing, closing in and completion, usually after a valuer or quantity surveyor confirms the work is done. Your deposit is normally used first. During the build you typically pay interest only on what’s been drawn, then regular repayments begin once the home is finished.
What lenders look for
- A fixed-price building contract with a reputable, registered builder
- Plans, specifications and building consent
- A valuation of what the finished home will be worth
- A realistic timeline, since approvals can expire if a build is delayed
This is general information only and isn’t personalised financial advice. Everyone’s situation is different, so please talk to one of our advisers before making decisions about your lending.
Construction loan questions
Can’t see your question? Give us a call or send us a message. See our public disclosure for details of our fees and commissions.
Do I pay the full mortgage while my home is being built?
Usually not. Interest is typically charged only on the amount drawn down so far, with full repayments starting once the build is complete. Check the exact terms with your lender.
Can first-home buyers get a construction loan?
Yes. New builds can sometimes qualify with a smaller deposit than existing homes, depending on the lender and current rules. KiwiSaver can often be used too, though the timing works differently.
What if my build goes over budget or is delayed?
Cost overruns usually have to be covered by you, which is why lenders prefer fixed-price contracts. Delays can mean extra interest and approvals needing to be extended. We’ll help you plan for both.
Can I use KiwiSaver for a new build?
Often, yes, but withdrawals for new builds have their own timing rules. Talk to us and your lawyer early so the money is available when it’s needed.
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