How will the Recent Government Housing Changes Affect You?


Some changes to KiwiBuild have been announced, but will this make any difference

to your average first-home buyers? Brendon takes a look … and tries not to get too


In early September, the government’s KiwiBuild was announced. In this

reset there were some announcements about changes to the government’s first-

home grant and the government-sponsored Welcome Home Loan. I suggest these

changes will impact very few of our clients, but let me go through them

here. (And, although I don’t particularly like being cynical, they are completely

underwhelming in my opinion.)

1. KiwiSaver HomeStart Grant will become First Home Grant

A new name ... nothing here.

2. The minimum deposit requirement for the First Home Grant will reduce

to five per cent for both new and existing homes (currently the minimum

deposit is ten per cent) 

It really doesn’t matter if this is reduced to five per cent if the banks aren’t giving

loans without a ten per cent deposit—which they generally aren’t right now.

3. The First Home Grant can be paid to all buyers, who are eligible for the

grant, where there are three or more buyers, by removing the current cap

of $10,000 for existing houses or $20,000 for new properties.  

If you are looking at buying a house with more than two people, great, but don’t

forget there is a maximum purchase price ($500k for existing and $550k for new

houses … and an income cap that still applies).

4. The definition for new properties for First Home Grants will be amended

to define new properties as properties where the Building Code

Compliance Certificate was issued less than twelve months before the date

of the first home buyer’s First Home Grant application (currently this is six


I haven’t had a situation in the last 5 years where this would have made a


5. Welcome Home Loan will be renamed First Home Loan

Name change only. Moving right along.

6. The minimum deposit requirement for First Home Loan will reduce to

five per cent for both new and existing properties.

Finally, something. A loan where you only need five per cent deposit! But, again,

don’t forget that the current maximum price the house can be to apply for the

First Home Loan (nee Welcome Home Loan) in Wellington is $500k ($550k for a

new house) and the income is limited to $80k for an individual and $130k for a

two or more. How many house in Wellington can you get for less

than $500k? Or new builds for less than $550k?

I would suggest if the house price limit is increased and the income threshold is

increased, this would make a difference for first home buyers in Wellington. I

would hope this is being looked at with some urgency, otherwise I am sorry but

it seems to me to be business as usual. 

But don’t give up. If you are a first-home buyer we can clarify what your options

are. Do make contact and we can have a chat.

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.