HOMEBUYERS DISCOVER THE COST DIFFERENCE BETWEEN NEW & EXISTING HOMES ISN'T WHAT THEY THOUGHT

Lots of people assume building new is where the hidden costs live - upgrades, landscaping, “oh that’s extra”, the lot.

But with builders who price transparently and spell out inclusions clearly (hello, Classic), a new build can actually be the more predictable option - and in many cases, you might only need a 10% deposit to get started.

Meanwhile, it’s buying existing (and renovating) that tends to come with the real budget blowouts: you can pay a premium for someone else’s design choices, then fork out again fixing old problems and undoing questionable DIY.

Then you hit the next speed bump: deposits and finance jargon.

So let’s clear up one thing that surprises a lot of first home buyers:

You might be able to build your first home with just a 10% deposit.

Yep. Not 20%. Not whatever deposit figure a vendor or real estate agent decides to set.

Just 10% down, and you could be in the game.

Why people miss this option

A lot of people assume building is the complicated, out-of-reach path, so they keep saving and watching from the sidelines.

But building new can be a very structured way to buy:

• No auctions

• Less “unknown history” than existing homes

• Fixed-price contracts (so you can plan properly)

How the payment side works (minus the jargon)

When you build, there are two common ways the payments are structured.

Progress payments

Your home is built in stages, and your bank releases funds along the way (slab, framing, roof, etc.).

Why people like it:

• You’re paying for what’s been completed

• It’s often lower overall cost because you’re not covering the builder’s finance risk

Turnkey

You pay your deposit now, then nothing more until handover day.

Why people like it:

• It’s simple and predictable, especially if you want to keep life tidy while the home is being built

Either way, you don’t necessarily need a huge amount upfront, and your lender will help determine what suits your situation.

Want a deeper breakdown?

https://www.classicbuilders.co.nz/blog/education/building-finance-explained-turnkey-vs-progress-payments/

What do lenders typically want to see?

Most lenders are looking for:

• A deposit (often around 10%, depending on your situation)

• A fixed-price build contract

• Proof of income + expenses

• Plans + consents

And many lenders like new builds because they’re modern, code-compliant, and tend to have fewer immediate maintenance surprises.

Building new vs buying existing: the practical upside

If you’ve been looking at older homes while thinking about the renovation work they’ll need, building new could be the clearer path:

• You know what’s included

• You know what you’re paying

• You can plan your next steps with less guesswork

FAQs

Can I really build with a 10% deposit?

In many cases, yes, but it depends on your lender, income, and the details of the build contract.

Is building more expensive than buying an existing home?

Not always. With a fixed-price build you can avoid auctions and many of the “surprise repair” costs that can come with older homes. Long-term, new homes can also be lower maintenance.

What’s the difference between progress payments and turnkey?

Progress payments = paid in stages as the home is built.

Turnkey = deposit now, then settle at handover.

What help can Classic Builders give me?

We’ll talk you through the process, keep things clear, and guide you from early questions through to handover, with support that continues after you move in.