Buying your first home is exciting - but it can also be expensive and stressful. Here are some ways in which KiwiSaver and the NZ government can help first home buyers get their foot in the property ladder.
If you have been contributing to KiwiSaver for at least three years, you may be eligible for KiwiSaver’s first home withdrawal and the government’s First Home Grant.
KiwiSaver First Home Withdrawal
KiwiSaver helps New Zealanders save for retirement, but it can also be used to help put together a first-home deposit. With KiwiSaver’s first home withdrawal, you can withdraw as much of your KiwiSaver funds as you need, as long as you keep $1,000 in your KiwiSaver account afterwards.
To apply for KiwiSaver’s first home withdrawal, make sure you contact your KiwiSaver fund provider in advance. Your KiwiSaver account is a locked-in investment account, so it may take around 10 days to process your withdrawal application and release your funds.
First Home Grant
The NZ government also offers a First Home Grant (previously known as KiwiSaver HomeStart grant) to help first home buyers buy their first home.
To be eligible, you must have been contributing at least the minimum amount of your income (currently 3%) to your KiwiSaver scheme for the past three years.
If you are buying an existing or older property, the First Home Grant can grant up to $5,000 for an individual or up to $10,000 where there are two or more eligible buyers. If you are buying a new property, the First Home Grant can grant up to $10,000 for an individual or up to $20,000 if there are two or more eligible buyers.
The amount granted depends on how long you have been contributing to KiwiSaver. As an individual buying an existing or older home, the grant is $1,000 for each year of contribution (up to a maximum of $5,000). As an individual buying a new home, property bought off the plans, or land to build on, the grant is $2,000 for each year of contribution (up to a maximum of $10,000).
To be eligible for KiwiSaver’s first home withdrawal and the First Home Grant, you would need to live in the property for at least six months after the initial purchase (it cannot be an investment property). Additionally, you will not be eligible if you already own land or property in New Zealand or overseas.
If you have owned land before (but no longer have interest or share in the property), and your financial position is considered the same as a first home buyer, you may still be eligible for KiwiSaver’s first home withdrawal and the First Home Grant. To be considered a ‘previous homeowner’, you would first need to apply through Kainga Ora.
You can find more details on the eligibility criteria of KiwiSaver’s first home withdrawal and the First Home Grant under 'First Home Buyer Questions' on our Frequently Asked Questions page.
Make sure you leave enough time for your KiwiSaver first home withdrawal or First Home Grant application to be processed.
As a long-term investment account, it may take around 10 days for your KiwiSaver funds to be withdrawn. It is also a good idea to look into the First Home Grant when you start looking for property, this is because you cannot apply for the grant once you’ve already purchased the house.
Here to Help
Buying your first home requires commitment and hard work, combining this with sound financial advice can ensure you get it right the first time around. Making the best use of your KiwiSaver can make a large difference when buying your first home.
You’re only allowed to access your KiwiSaver funds once to help buy your first home. To help you put your best foot forward on the property ladder, National Capital will take your unique goals and situations into account when helping you come up with a KiwiSaver plan.
If you are looking to use KiwiSaver to help purchase your first home, National Capital is here to help. To take the first step of receiving free personalised KiwiSaver advice, complete our KiwiSaver HealthCheck.