When you’re considering building your new home, it’s natural to be drawn towards promotions and giveaways. In fact, as humans, we’re still extremely susceptible to simple marketing techniques such as seeing the word ‘free’. It makes us feel good like we’re getting a special deal. Sometimes, these promotions are even limited to a certain number of customers or for a specific amount of time. This one catches us too, thanks to a phenomenon known as Fear of Missing Out (FOMO).
The fact is, most builders around the country don’t need to offer outrageous deals and bonuses. Their reputation and quality of their work are enough reasons to choose them. Yet, those fancy signs with ‘FREE’ splashed across them still catch our attention.
Here’s what you should know about builder promotions in New Zealand.
What types of promotions are offered?
There are plenty of different techniques out there, all designed to make you sign a contract or put down a deposit quickly. But let’s think about it for a moment. Building a house takes a considerable amount of time. How many customers can your builder actually service? If they’re offering such incredible deals, surely, they’d be overrun with business. If that’s the case, how long will you have to wait for your home to be built?
There are a couple of different types of promotions you may see when researching builders. They generally fall into two categories.
Who doesn’t love a free giveaway? Well, it depends how ‘free’ it actually is. You’ll often see builders advertising things like free holidays. We’ve even seen some that offer to pay your rent while the home is built. However, there is a bit of a problem with these types of deals.
Firstly, are these bonuses actually free? Or are they built into an inflated cost of building your home? Generally, it’s the latter. Secondly, most builders offering these giveaways don’t even want to provide the free offering. When it turns out the cost of your home is inflated because the builder is adding in the cost of rent payments or holidays, the banks are less likely to give you finance.
So, what happens then? Usually, you’ll go back to the builder, who will recommend you just take a cash discount off the building cost instead. Banks are happy, you get finance, and the builder charges what they normally would have anyway.
Free or cheap upgrades
The other type of promotion comes in the form of upgrades. It might be outrageous statements such as ‘Free $20,000 kitchen upgrade’, which frankly, is inaccurate. Unless you’re going from the most basic kitchen imaginable to the most luxurious one imaginable, these upgrades never add the value indicated to your home.
Alternatively, it could be to do with your fixtures or appliances. We won’t outwardly discard these ones, but we will advise treading carefully. Often, if a builder is offering appliance upgrades, it’s because they’re getting a kickback from the manufacturer. Not a bad thing, because ultimately you get better appliances. However, it does diminish your choice, because you’ll be limited to a particular brand. Also, make sure the cost of these appliances isn’t just added in elsewhere, such as an increased per-square-metre cost.
There might be a catch
Be wary of all specials and promotions, because there is almost always a catch. Even if a builder is offering something pretty transparent such as a $10,000 discount, you need to take it with a grain of salt. They might be offering the discount in one place and recouping it elsewhere, such as charging extra for services that should ordinarily be included.
At the end of the day, if you can’t get an all-inclusive building contract or a very clear indication of every additional expense you’ll have, it’s not worth it. The peace of mind you gain from a fixed-price contract is worth so much more than any flashy promotion which likely delivers very little value at all.
Reputable builders are always a better option
If you really want the best deal on building your new home, there are plenty of factors to consider above a marketing gimmick. Firstly, the reputation of the builder is paramount. Check online, check their reviews and testimonials. See what people are saying about them on social media. You might think it sounds like overkill, but building a home is an extremely stressful experience if you get the wrong builders. So, it’s worth doing your research thoroughly.
Ultimately, it comes down to value for money, and that doesn’t always mean what’s cheapest. An initial low cost is great, but when you find out there are hidden extras, ‘unexpected’ expenses relating to your block of land, or even worse, shoddy workmanship, that low price looks far less attractive.