We’re Building Our First Home: Part One

Stevie and her partner decided that building was the right first step for them to get on the property ladder. This series is an insight into the reasons why and their struggles and joys along the way.

I come from a family of house-buyers-and-flippers. I'm the first one to build their first home (or any home to be exact) and that comes with its fair share of eyebrow raises at family get togethers. However, what shocks me is that more people in Wellington aren't doing it.

Believe it or not, our house buying journey actually started at Buyers Club at Velocity Financial.

My partner and I had been talking about buying our first home but put it on the back burner until we had more deposit saved up. After attending Buyers Club, we flirted with the idea of using our parents as guarantors for our deposit and started house hunting.

We considered everything—building, buying new and buying secondhand—but we were under the impression that buying secondhand would be the easiest and cheapest option.

The reality that Wellingtonians and Aucklanders are finding is that buying new and buying secondhand can be the same price, depending on the area you are looking.

Six months of house hunting, countless open homes and four failed attempts at trying to buy a property, we reached our limit for attending open homes. We were tired of spending our spare time going to open homes and scouring TradeMe for our dream home. We decided that October would be our last month of house hunting until the new year.

We had also come to two key conclusions by this stage of the house hunting process:

1. To get the house we wanted, we would have to spend more money on a house than we had originally planned; and,

2. We may not be living in the suburbs we originally had wanted to.

Discussing these revelations with everyone at work, the topic of a new build came up again, so we started hunting around. We found a few developments who were selling "turn-key" builds. What this means is that you sign up, pay a deposit and agree to buy the property when it has been built. This means that you aren't paying rent and a mortgage at the same time (which was perfect for us).

We found a development that was 20 minutes further out of town than originally desired but it would give us a warm, dry home with a ten-year warranty and it was so much bigger than we originally thought we could get.

More than that, we could use a ten per cent deposit and not have to use any parents as guarantors! We would also have the ability to save up as much money as we could before the build was complete. We travelled to the show home, looked around at the model home and signed up then and there.

In the last 10 months since we signed up, a lot has happened and not a lot has happened. We've finalised the plans of the property, picked out our colours and appliances and saved, saved, saved! There has been an array of emotions from excited about moving out of our damp rental to nervousness that our place won't be built before next winter. But our foundations have been laid and we can now see the finish line.

My one piece of advice through this process is this: Don't dismiss a new build just because it seems expensive or not in your perfect suburb or because you don't know anyone else doing it. Talk to someone who has done it and decide whether it could be right for you. You might just be surprised.

Knowing What I Know Now, What Would My First Home Look Like?

By Graham Goodisson

Listen in as Graham shares his property purchasing insights with a younger, less-real-estate-savvy version of himself.  

It’s obviously a little unfair to answer this question being that I am a different person now, however, it’s an interesting window into some of the key lessons I’ve learnt working in the industry over the years.

So, for starters, I would not be so conservative with that first purchase. I would push the envelope so to speak. Why? Well, because lots of the terrible things that might happen tend not to (obviously this is not financial advice to act on and, please, do see my lawyer!).

Another factor that I overlooked was not knowing how the house needed to work for young kids. This was unfortunate as my first son was born three days after we moved in. I would value drive-on access above all other things—because, with a young family in Wellington winters, drive-on is a gift.

I would value sun more. I would visit the house I was interested in at different times of the day and on windy days! Basically, more than just at open home times.

I would buy as soon as I could—not delay it. If it’s possible then make it happen.

I would avoid the trendy Resene colour-of-the-day when renovating. All tenants that followed hated the yellow walls and polished floor boards (they wanted carpet). I would also know that renovating bathrooms and kitchens does cost more than you think so, if I had a choice, take the house with those things done.

I would also now know that all house reno’s do need consents!

Luckily, I didn't know any of the above and just ploughed on regardless, its amazing how you make it work.

Graham Goodisson is a Registered Financial Adviser with Velocity Financial. No investment decision should be taken based on the information in this blog alone. A disclosure statement is available free of charge upon request.

Should I Buy Now or Later?

You’ve got a small deposit saved up, so should you buy a house now or save up for a bigger deposit? Brendon explores and offers some tips on timing the market and seizing the day.

I talk to potential first-home buyers every week and one of the most common questions I am asked is, "Should I buy now or should I keep saving and wait a bit?”

This is how I answer.

1) You have to have at least ten per cent deposit. 

If you want to buy a house for $500,000, $50k is pretty much a minimum figure needed through savings or KiwiSaver (or a combo of the two. If you haven't got that (and you can't get some help from family—which is another blog in itself) then keep saving! 

Be aware also that banks are a little tougher with a ten per cent deposit than a 20 per cent deposit. And some types of property (i.e. apartments) won't be possible to purchase with only ten per cent. That aside all aside, however, you may well be ready to go.

So, if you have ten per cent then lets have a talk. 

2)  If you have 20 per cent deposit, you are in a better position to buy. 

Twenty per cent is the magic number, and if you fall just short of that, and you can get there within a few months, it may be worth saving hard to get to this figure. When you go to the bank with 20 per cent, the deal you will get (in terms of interest rates and the cash contribution they offer) will be better and the banks will be a little more lenient on the amount of income you need.

So, in summary …

Don't be put off by number 1. Lots of my first-home buyers only have ten per cent and they have successfully purchased their first home.

Finally, a helpful comment on getting in to the market ... 

I would argue that when you are ready to buy (see above) and you find the house you want to live in, then attempt to buy it. If you plan to hold the property for many years, I am just not convinced "timing the market” is the way to go. 

Take the Wellington market, for example. There was high price inflation from 2000-2007 (with a wee slow down in 2004). The Global Financial Crisis happened and Wellington house prices "nudged back" by maybe five per cent. They were then steady right through till 2016, and since then have increased by around 40 per cent. Through all this period of almost 20 years, the best time to buy would have always been "today". 

I am not promising there will be no market corrections in the years to come, however, Wellington’s house market history is periods of stability followed by bursts of increases. Adding to this argument is, the longer you plan to hold the property, the less relevant trying to "time the market” becomes, because, prices will increase over time. If you’re planning on trading properties, that is a completely different conversation—another blog!

Yes there is a conversation around renting forever and investing the savings. If you are that way inclined, there is a conversation to be had, but if, at some stage, you are wanting to live in a house you own, then see above.

At the risk of sounding like a real estate agent (forgive me all my real estate agent friends!) I think it is generally true, the best time to buy your first house is now!

Brendon Ojala is a Registered Financial Adviser with Velocity Financial. No investment decision should be taken based on the information in this blog alone. A disclosure statement is available free of charge upon request.

Handy Hint for Being Application Ready

Online statements are great for the trees, but not so great when it comes to proving your address while making an important application. Here’s a quick ninja tip for both saving the planet and saving yourself some stress.

These days it’s great to see so many companies encouraging us to use and download online statements, rather than printed copies. Some are even charging for paper statements to encourage us to do our bit for the planet.

However, it can be an issue if you need to prove your address at any stage.

Whether you’re opening a new bank account, putting something on hire purchase or buying/selling a house, they will require a utility bill or bank statement that has been sent to your home to confirm your address in the last three months.

So, a handy hint from the people who have helped process hundreds of mortgage applications …

If you have no utility bill or bank statement coming to your home address, get something (i.e. a utility bill or bank statement) sent to your home address at least once. This might mean turning paper statements on and then off after a delivery or two. Simple solution.

No investment decision should be taken based on the information in this blog alone. A disclosure statement is available free of charge upon request.

FAQs: What happens to my life insurance if my partner and I seperate?

We take insurance policies out our partners to mitigate the financial effect on our lives if they die or become ill. If I am the life assured, that makes my partner the policy owner. My partner receives the sum money my life is assured for if I die, and vice versa.

“If they own my life insurance policy, does ownership change when we separate?”

Your separation may or not affect the ownership of the life insurance policy. If a couple separate and there are kids involved then often the insurance stays in place and the ownership remains as it was for the benefit of the kids. Essentially, if my ex-partner dies, I am still affected financially.

It can get a bit sticky when the separation is not amicable. You don’t control your life insurance policy, so if you and your partner separate they can choose whether or not they want to shift the ownership.

“How do I get ownership of the life insurance policy when it’s owned by my ex! I now want it as my health has changed since I took the policy out originally and I could now be uninsurable.”

The short answer is you can’t. You don't own or control the policy the policy owner controls it.  As above, they can shift ownership to you if they agree to that.

The solution? Always get professional advice before taking out a life insurance policy and make sure you understand the ins and outs of the policy ownership.

Graham is a Registered Financial Adviser with Velocity Financial. No investment decision should be taken based on the information in this blog alone. A Disclosure Statement is available free of charge upon request

3 steps to make post-break up financial decisions manageable

Working out financial details after or during a break up can be awkward and upsetting. This situation, while sometimes fraught, is definitely not uncommon! If you find yourself in this position, here are the steps you can take:

1. You both need independent legal advice

Depending on the length of relationship, if you’re married, or whether you have children, there will potentially already be lawyers involved. Not all solicitors do all types of law, bigger firms will generally have a cross section of specialist solicitors that you can draw on. You’ll need to decide who keeps your current solicitor, and who goes to another lawyer for independent legal advice.

If one of you wishes to purchase the house you both currently own, or one or both of you wish to purchase other properties once current home is sold, you need to confirm how profit/equity will be divvied up.

The law has some very strong views on who gets what (which may differ from your opinions), if there had been a relationship property agreement drawn up, or if the property is in a trust, there are still plenty of questions for your solicitor.

2. When you decide to purchase, the bank assesses your current position

After the above is confirmed, the bank then reviews your current position based on your...

●      Deposit

●      Income (note if Child Support, is not set up through IRD, banks may not use this in you income calculations)

●      Debt levels

3. Talk to a financial expert sooner rather than later

We specialise in helping people navigate all the layers of property acquisition. We can answer questions like: What is happening in the housing market? How do I make an offer? Can I use KiwiSaver?

There are a lot of moving parts, so have a conversation with us when you know a decision needs to be made around your current property(s), let us lower you anxiety, and bring you one step closer to inner peace!*

*Lance does not have the ability to bring you inner peace.

Lance Shearman is a Registered Financial Adviser with Velocity Financial. No investment decision should be taken based on the information in this blog alone. A Disclosure Statement is available free of charge upon request.

From Facebook to your Mortgage: What happens when you die?

You’ve possibly already thought about some of the more obvious things like your house, your car and your family. But what about your bank accounts? Or even your Facebook profile? Wrapping up your whole life is not a simple task as Alex explains.

What happens to my mortgage and bank accounts when I die?

When you pass away the bank requires you (as the other party of the contract) to pay back lending in full before any property or money is distributed to beneficiaries.

All bank accounts and overdrafts are immediately stopped. Payments to the bank for interest and fees will still continue from the same account to avoid defaults. Then your estate needs to service the loans in the interim from those accounts. When you co-owned the property, the ownership can be transferred solely to the surviving owner.

Business accounts are a bit more tricky and these will freeze instantly as the owner of them is no longer there. If there is a partnership they will be frozen well as the partnership ended upon the passing of the other partner.

It is very wise to update your lawyer 

What about my Facebook account?

When you die, nothing automatically changes to your Facebook – but as soon as Facebook knows that you are no longer with us (and boy, do they know) there are a few options that you can choose:

1. Leave it as it is

You can, of course, leave the account as it is. This is not recommended as it means your data is guaranteed to be 100% secure.

2. Memorialise your account

Your loved ones can ask for your Facebook account to be memorialised by completing a memorialisation request and providing a scanned copy of the death certificate. Once the account is memorialised, no content can be altered or removed and the account is effectively locked down to eliminate any chance of being hacked. Only legacy contacts (your ‘digital executors’ can post on your behalf (for example, to give friends and family details of a memorial service). Friends and family can still post on your timeline to share memories.

3. Delete all data

Facebook only allows immediate family members to request all your data be deleted. They process this as a special request, and it requires scanned documentation as proof of your death. You can download all your Facebook data at any time if you wish to keep back ups.

Of course, that’s not even the half of it!

Come and have a chat to us or make an appointment with your lawyer to talk about it more. We’ll help you take charge by working out what might be the best option for you – and getting it down in writing.

Alex Barendregt is a Registered Financial Adviser with Velocity Financial. No investment decision should be taken based on the information in this blog alone. A Disclosure Statement is available free of charge upon request

Kylie’s 5 Summer Reno Tips

Whether the goal is to sell or to dwell, Kylie shares her five top tips for making renovations work for you and for your financial and lifestyle goals.

1. Budget

Are you planning on living in your property long term? Before setting a budget, think about your plans. Adding a swimming pool to the family home might not get the return you’re after when it comes time to sell, however, if you’re around for another 20 years it’s can be an investment your family will have time to enjoy.

Consider the re-sale value of your property and your target market if you were to re-sell. Look at what other properties in your neighbourhood are selling for and consider what you paid for yours.

It may be tempting to put an expensive $30,000 designer kitchen in, but not everyone can appreciate the difference between a $15,000 flat-pack kitchen and a designer one. However, doing things on the cheap can be counter-productive, too.

2. Keep it simple

Most buyers will be interested in putting their own stamp on the property. So, choose your colours and patterns carefully. Opting for neutral colours and styles is always the safe option.  

3. Make a priority list

If you’re not sure where to start, concentrate on things that will improve the comfort of your home, such as insulation and heating.

4. Consider your target market

If you are thinking about removing a bedroom to create more space in your dining room, it pays to think about who your target will be if you sell. Will your home be suited to a young family or a retired couple? The ideal number of rooms and the ideal size of the dining room will vary for different buyers.

5. DIY or professional?

It may be tempting to take a DIY approach to renovations, but some jobs are best left to the pros. Anything structural or major gas, electrical and plumbing work is best outsourced. Purchasing fixtures and plumbing yourself might not be the cheapest option either, as tradies can usually get trade discounts.

Brendon's Bathroom Budget Blowout

Renovating the home you own rather than buying the house you may not be able to afford is an attractive option right now. But it’s not without its pitfalls … as Brendon found out. 

House-price inflation has two impacts that I want to reflect on:

1. People who own property feel richer ... because their house is worth more.

2. People are opting out of purchasing a nicer home. They are concerned about the cost of the new house, what their new mortgage would be and the risk that their house might now sell and they won’t be able to buy again. (As an aside, we may be able to help with the last one.)

So, what do we do when we already own a house but we don’t want to upgrade?

We renovate!

This can be a good option. Why not get your house into a state you are happy with and actually get to enjoy it—much better than just getting it there a week before you sell it and move out? Of course, the downside is the mortgage gets bigger rather than smaller over time.

I found myself in this situation this year and now have two new bathrooms, new carpet, paint and curtains. Yee ha!

However, here are some important life lessons learnt along the way:

1. Do your figures. Then double them.

2. Estimate the time frame. And then double it ... at least.

3. Remember all those extra things you might like to get your builder to do. Bigger cavity sliders, recessed shelving in the shower to put your shampoo in, extra lights—it all costs more money and can blow budgets (see 1 and 2).

4. When I did my figures, I asked myself, "How much can I get a toilet for? $500?”. Somehow I decided to buy the $1200 one. And, yes, we do need a black flush plate thing to match the black taps (see 1).

5. Tradies are busy right now and in to the foreseeable future (see 1 and 2).

6. If you are going to stay put for 10 years, design the house how you want to live in. For example, don't put a bath in just because it will “add to resale value” if you or your family aren't “bath” people. In 10 years, your bathroom will be tired and may need another make over anyway.

Several lessons learnt, but loving the new bathroom and its colour coordination!

Brendon Ojala is a Registered Financial Adviser with Velocity Financial. No investment decision should be taken based on the information in this blog alone. A disclosure statement is available free of charge upon request.

Home & Fashion Styling: Why Kmart is the answer

Summer is here. It’s time to make those touch ups around your home and to also confirm your summer gear still fits and, more importantly, is still on trend! So, here is Lance’s summer style guide.

1. You can dress your house at Kmart!

I’m not sure if you have been paying attention lately but Kmart has now become the go-to store for on-trend décor and value-for-money style … no jokes! Plus, they are open late and, if you select the right pieces, you will have your guests jealous about your “high end” accessories.

2. Front doors, rollerblades and bum bags

We all know the importance of first impressions. Your home entrance should look great, so take the opportunity to freshen up the front door of your home—either spruce up the existing paint job or go crazy with a bright feature door to show off your personality.

The same goes for your personal fashion choices. Make a bold entrance to summer with something daring that expresses your uniqueness. Perhaps it’s a return to the 80s with a belt bag and some roller blades? And, although black is classic, be sure to have something fluoro in your arsenal so you stand out from the crowd.

3. Storage and Clutter

Jerry Seinfeld shares some wise words on decluttering your home:
“There are too many things! … All things on earth only exist in different stages of becoming garbage. Your home is a garbage processing centre, where you buy new things, bring them into your house and slowly craperfy them over time.” – Watch Jerry’s full skit here https://www.youtube.com/watch?v=HfYzlSNHapA

So, if you’re guilty of running a home garbage processing centre, save yourself from the inevitable and take older or less loved items to a charity store or sell them on TradeMe. Do it now and enjoy a clutter free summer!

And what about fashion? Well, go to your wardrobe, if there are items you didn’t wear last summer, put them in a bag and take them to your local Salvation Army Family Store. Those items are just taking up space and now you can put new stuff in there you will actually wear!

Lance Shearman is a Registered Financial Adviser with Velocity Financial. No investment decision should be taken based on the information in this blog alone. A disclosure statement is available free of charge upon request.

Is a capital gains tax the answer?

It’s been a favourite topic in the media, but what effect would a universal capital gains tax have on property prices? Graham explores.

 

First things first, let’s clear up that capital gains does exist on rental properties: if you buy and sell within two years you will pay tax on any gain on your rental property.

The question is, what would it mean if this same tax was also applied to owner-occupied properties? If it were implemented, will it stop the crazy increases in house prices that New Zealand has experienced?

Short answer … I don't know. 

There is no evidence from overseas markets that it seems to stop housing inflation. In regard to capital gains on rentals, this is easy to overcome by just buying an additional rental that you effectively put aside as one to sell to pay your tax bill. 

The real question for me is how our children will buy property. I think that family assistance for property will become more and more important. First home buyers in Wellington city are certainly paying $700k and up. In five years’ time who knows what they will be paying but I certainly know my kids will be talking to me for some kind of help. Maybe I’ll just them to the opposition as it will be in the very hard basket!

Graham Goodisson is a Registered Financial Adviser with Velocity Financial. No investment decision should be taken based on the information in this blog alone. A disclosure statement is available free of charge upon request.

AJ's African Adventure

What did your 13th birthday party look like? For Brendon’s son, AJ, it’s definitely going to be one to remember.

Brendon's son Anaiwan (AJ) has just turned 13 and it is the Ojala family tradition to have a "rite of passage" adventure to mark the occasion. So, in December, Brendon and Anaiwan are travelling to Africa for a couple of challenges.

The first is to climb Mt Kilimanjaro.

Standing at a height of 5895 metres, the father and son duo expect to knock off the beast in eight days. Apparently, it’s not a technical climb, more of a trek, the major challenge being the lack of oxygen when you’re 6km in the sky. So a slow walk up the mountain will maximise their chances of success.

The second challenge is to build a classroom.

After recovering for altitude sickness and allowing sometime for Brendon to catch up to his son, they are then visiting a children’s home for a week where they will hang out with the kids and staff and help in any way they can.

Anaiwan has been tasked with taking a gift with him, so is fundraising to help build a classroom at the orphanage. This classroom is needed to run school lessons but also because government regulations require it to keep the orphanage open. AJ’s goal is to come up with $5000 towards the total build cost of $15,000.

Over Labour Weekend, AJ is fundraising by getting people to sponsor him to climb 6000 metres over eight days. He starts on Sunday 14 October, so if you’d like to contribute to help get this classroom built, head on over his Givealittle page: AJ's African Adventure (all funds go to the children's home). 

You can follow AJ and Brendon’s adventure on their Facebook page: AJ's African Adventure. And stay tuned for a report early in the New Year.

Remember the days of the old school yard

The property market is much like the school yard; it’s full of bullies, rules, rule enforcers, and of course opportunities for growth and the people to help you grow.

My daughter turned five a couple of weeks ago. Awesome, she is now off to school! But what came next I was not prepared for: immense sadness.

It was sadness that my baby had taken her first step to independence, pain and concern in being responsible for making her go to a place where she knows absolutely nobody, and the fact that for the next 13 years she will have to raise her hand if she wishes to go to the bathroom.

Why did nobody warn me? And where was my fathers-of-five-year-old-girls support group?

When I started school I can vividly remember loving it from day one (well, truth is, I cried day one … a lot, but day two onwards was great!). I didn’t occur to me at the time that my parents, also, might have the same sort of concern that I’ve had these past weeks.

Anyway, all this reflecting on the virtues and risks of school, got me thinking that the lessons from the school yard transfer well into the property world. So, here are my three top school yard lessons for the home-buyer:

#1 - The more you learn, the better things go

If you pay attention in class and do your homework, much of your school experience runs fairly smoothly. It’s the same when looking to purchase property.

Those who go in most educated, learn the importance (or lack of importance) that RVs play in your decision-making process, know what to do when something you wish to buy has unconsented work on it, or know who you should consult to make sure your offer actually legally protects you, will come away with a higher chance of success and less chance of falling in to traps.

#2 – Find your BFFs

Today (my daughter’s eleventh of school), when dropping my daughter off, three children came up to her and said, “Can we play with you?” Then all four of them ran off and I left watching them running around laughing. I felt comforted in knowing she has a network of support.

The idea of purchasing sounds like fun. However, once we’re in the thick of it all, signing on the dotted line and trawling through confusing legalese, there is nothing more comforting knowing that you have team around you, who all place your best interests first. Your Velocity Financial adviser is a key member of that support team. We will keep you informed, we’ll do much of the donkey work for you, and you can contact us and ask your questions, absolutely any question! Let us support you.  

#3 - Avoid the headmaster’s office!

If you are in the dreaded headmasters office, things are not going well with your school experience. We can all identify (or have several first-hand experiences!) with this threat of going to see the person at the top, who will tell you off in such a way that makes you wish you still had the comfort of “pull ups” for back up when the fear kicks in.

Unfortunately, in the finance world, we have seen people who have found themselves in a world of trouble. Sometimes this is through association, debt from previous partners (“hanging out with the wrong crowd”), or have simply not understood the true ramifications of the decisions they have made (such as tax implications upon sale of a property). Our role in these situations is to sit with you, unpack your situation and help you navigate your way out. We’ll help you understand what will keep you away from walking down that lonely hallway to the naughty chair.

Lance Shearman is a Registered Financial Adviser with Velocity Financial. No investment decision should be taken based on the information in this blog alone. A disclosure statement is available free of charge upon request.

How your online info can scare banks away

We might be connected better than ever thanks to the Internet, but this excess of information isn’t all good news when it comes to finance and property.

A quick Google of myself and my home address discovered this about me:

• Where I last went on holiday
• The companies of which I am a shareholder and director of
• My last marathon time
• A lot about my business and who I work with
• An estimate of what my house would rent for
• That I write lots of awesome blog posts(!?)
• A YouTube video of me
• A bunch of work photos
• My estimated house value
• My neighbour’s estimated house value
• My credit score

There is some helpful stuff here, but also some stark finance-related privacy concerns. Here are a few thoughts …

Credit scores

In business and when it comes to trying to get a mortgage or secure credit of any kind (from getting a power account, to renting a home or getting a couch on HP) your credit score matters. Your credit score is something to take seriously and protect carefully. 

Here’s my advice: Pay now and argue it later. A clean credit score matters more than a $100 phone bill or gym membership dispute. Furthermore, companies are now reporting to credit agencies if you pay your bills on time. So, if you are considering applying for credit, be sure to keep those bill payments rolling through on time.

Where I went on holiday

Mental note, change my privacy settings on Facebook.

What my house will sell for

In my work, I deal with lots of real estate agents and from them I have heard some of the dangers of relying on estimates of house prices/values. 

Although it is kind of fun to know what your (or your neighbour’s house) is worth, it is a pretty broad estimate, based on comparable sales, that a computer algorithm works out. It is pretty clever, but of course it hasn’t viewed the condition of your property or your neighbour’s or the state of comparable sales or the way your place soaks up the sun or grows mould and so on and so on.

These “smart predictors” can lead to false expectations by all parties (buyers and sellers of property), so do take these figures with a grain of salt. And I would make the same comments about the newly launched online rental appraisals that are now popping up.

If I can find out the above about me, so can you … and all my clients, colleagues, family and friends. An awesome opportunity and a sobering thought.

Brendon Ojala is a Registered Financial Adviser with Velocity Financial. No investment decision should be taken based on the information in this blog alone. A disclosure statement is available free of charge upon request.

Guest blog: How to create a warm winter home

Tim Kloeg of Wellington Refrigeration is an expert on heating and cooling homes and he shares his tips on how to stay cosy inside when the weather turns icy outside.

1. Insulation is key

Current building code has high standards in regard to insulating and sealing new homes. Unfortunately, for many of us with older homes, these building codes have come a little late leaving us with poorly insulated homes and regular air changes—a fancy name for drafts.

Sealing timber windows, floors, and doors, with off-the-shelf items from the hardware store such as foam tape, gasket tape, or door strips can make a big difference, and are typically inexpensive. Thermally lined curtains are a good investment, especially for houses with single-glazed windows.

The larger cost items are insulating under the floor, in the ceiling, and in the walls. The best way to check wall insulation is to turn the mains power off and take an exterior hot point off the wall to see if there is insulation behind it. And this leads to the next part …

2. Heating your home

I like (no, love!) heat pumps.

An interesting fact that many people don’t know is that heat pumps are basically reverse cycle refrigerators or air conditioning units. High wall heat pumps were primarily designed for hot climates as air conditioners, and the reverse cycle heat pump came about as a by-product of that.

The cooling mechanism works by putting an air conditioner high where the heat is (because heat rises) and simply replace that hot humid air with cool dry air.

However, in Wellington, we primarily run our heat pumps on their heating cycle. So we’re best to put the heat pump down low, where the cold air is, and effortlessly replace it with warm air. Simple physics!

My preference, therefore, is to recommend floor mounted, or even under floor centrally ducted heat pumps wherever possible.

There are many different ways to heat your house, and Tim from Wellington Refrigeration can help you with all your heating and air conditioning questions. You can contact him on 04-565 0550 or email tim@wellingtonrefrigeration.co.nz