Westpac has announced a new mortgage product aimed at prefabricated homes following a successful nine month test pilot, which involved builders and customers from Albany to Invercargill.
The Westpac Prebuilt product aims to help Kiwis get into prefabricated housing, which has been increasingly utilised as one solution to the lack of housing supply and shortages in affordable construction options.
Westpac announced the trial run of its scheme in May 2018, saying that a prefab build could save on average 15% in construction costs and 50-60% in build time. However, the financial risks associated with prefab construction had previously prevented customers from obtaining lending from mainstream banks.
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According to Westpac NZ Head of Home Ownership Mark Dunmore, the scheme will offer an affordable solution to potential homeowners looking to construct a prefabricated home.
“We think homes manufactured offsite are crucial in addressing two key systemic issues: our housing shortage and a lack of affordable construction options,” Dunmore said. “For the first time, we’re offering a simple and streamlined process for prefab buyers and builders, which will help put more New Zealanders into affordable and well-designed homes.”
“Our new way of funding essentially means we have security before the house is delivered, which removes much of the uncertainty for buyers and builders partnering on a build.”
The first prefabricated house is currently under construction in Huntly, and the banks says that a number of other homeowners have also been preapproved for lending under the scheme.
Albany customer Russell Pickering gave the designs a positive review, saying they “certainly don’t look like some of the modular homes of years gone by.”
“The builders were able to offer us pretty much anything we wanted to include,” he stated.
“We’re seeing fast-growing demand for transportable homes,” Build Smart General Manager Cameron Beverland added. “Building in a controlled factory environment simplifies the process, which is great news for both builders and home buyers.”
PrefabNZ Chief Executive Pamela Bell says that Westpac’s financing model “simplifies the most complex aspect of buying a transportable home.”
“The type of support being offered through this new programme has never been seen in New Zealand,” she said. “We expect it to be a hit with buyers and builders.