How to Finance a Shed in NZ with Loans Costs and Payment Options

Building a shed is a great way to add value to your property by increasing storage space and protecting your hard-earned assets. The challenge, for many people, is securing the right building finance to make the project happen.

In this article, we cover some of the most common ways to arrange finance for your shed project in New Zealand. Whether you’re building a garden shed, a workshop, or a storage unit, these options can help you move your project forward. 

4 Ways to Finance Your Next Shed Project

Traditional Bank Loans

One of the most common ways to obtain finance for a shed project is through a traditional bank loan. Banks offer a range of lending options designed to suit homeowners.

Before approaching a bank, you’ll need a clear plan and budget for your shed project. Prepare the necessary documents,  including estimates, property value assessments, and proof of income, to present a strong case.

It also pays to compare loan terms, interest rates, and repayment options between banks to find the best fit. Alpine can send you preliminary estimates to support the process and help you understand how much you may be able to borrow.

Home Equity Loans

If you’ve built up equity in your home, a home equity loan can be a good option. This type of loan lets you borrow against the value of your property, using your home as collateral. The amount you can borrow depends on your available equity and your creditworthiness.

This can offer a lower interest rate than unsecured lending. However, it’s important to be confident you can meet repayments, as failure to do so can put your home at risk.

Personal Loans

Personal loans can also be an effective way to secure building finance, particularly for smaller projects. These loans are usually unsecured, meaning no collateral is required. To qualify, you’ll typically need a good credit score and a stable income.

As with any lending, shop around and compare offers across different institutions. Keep in mind that personal loans often come with higher interest rates than secured lending, so it’s important to have a solid repayment plan. 

Home Improvement Loans

Many lenders offer home improvement loans specifically designed for renovation and improvement projects, including shed builds. These loans can have favourable terms and may offer lower interest rates than a standard personal loan.

Home improvement loans usually require a clear plan for your project, including cost estimates, contractor details, and timelines. The lender may also want to understand the expected increase in property value resulting from the shed construction.

Research lenders and compare products to find the most suitable option for your needs - especially if you’re weighing up different types of finance building projects.

What Additional Costs Should You Consider in a Shed Finance Application?

• Permits and permissions: You may need building permits and must comply with local regulations. Check with your local municipality or council to confirm fees and requirements. As a guide, expect $3–$5k for consent costs.
• Site preparation: Clearing and levelling the site may be required. Costs depend on land condition, vegetation, and debris. Alpine recommends working with a local contractor for a budget guide.
• Access and driveway: If your shed isn’t easily accessible from existing driveways or paths, you may need to create or upgrade an access route, which can add to your overall budget.
• Utilities: If you want electricity, plumbing, or other services, factor in the cost of running lines to the shed. This can require professional installation and may involve permits.
• Security and safety: Consider locks, alarms, or surveillance systems. Depending on the shed’s use, safety features like fire extinguishers and emergency exits may also be necessary.
• Finishes and customisation: If you plan to add paint, flooring, shelving, or other fit-out items, include both materials and labour in your budget.
  
  

Summary

There are several ways to secure finance for a shed build, depending on your situation. At Alpine Buildings, many customers use traditional bank loans, but home equity loans, personal loans, and home improvement loans can also be strong options.

Before committing, assess your financial position, compare rates, and read the terms and conditions carefully. With solid planning and a clear budget, you can secure the funding you need and bring your shed project to life.

Wondering what a shed costs? Check out this article for an overview of estimated shed costs and what you might expect to pay. Alternatively, reach out to our team to discuss your next project.