May 19, 2022
Shona Gaitanos
First Home Buyers
All Blogs

First homes now possible on a 5% deposit

We have some good news for first home buyers.

First home buyers have had it rough for some time now, however the government changes to the First Home Loan and First Home Grant products administered by Kāinga Ora means more Kiwis will be able to purchase their first home in 2022.


First home buyers who are eligible for the scheme could get into the property market with a 5% deposit


What is the scheme?

Get a contribution towards your deposit

If you’ve been contributing to your KiwiSaver for at least 3 years you may be eligible for a First Home Grant of up to $10,000 to top up your deposit.

If you buy an existing home, you can get $1,000 for each of the 3 (or more) years you've paid into the scheme. The most you can get is $5,000 for 5 or more years.

If you buy a new home or land to build on, you can get $2,000 for each of the 3 (or more) years you've paid into the scheme. The most you can get is $10,000 for 5 or more years.

Other criteria and terms apply. Talk to us for more information.

Loans for a 5% deposit

Finding the deposit for your first home can be a struggle, with most lenders currently requiring a minimum 20% deposit. But with a First Home Loan you only need a 5% deposit which means getting into your first home is that much easier. First Home Loans are issued by selected banks and other lenders, and underwritten by Kāinga Ora. This allows the lender to provide loans that would otherwise sit outside their lending standards.

Other criteria and terms apply. Talk to us for more information.

Need help? We can check your eligibility and talk though lending options with you

Book your free consultation with one of the Velocity Team

What has changed?

CHANGES TO THE FIRST HOME GRANT

  • House price caps for the First Home Grant have increased in many parts of the country, to align with lower quartile estimated values for new and existing properties. Wellington house price caps (for Wellington Urban Area, Kāpiti Coast District, Upper Hutt City, Porirua City, Lower Hutt City, Wellington City) have increased to $750,000 for existing houses and $925,000 for new builds.
  • KiwiSaver requirements have been adjusted, to reduce the threshold amount of regular savings to access the grant.
  • A new income cap category has been introduced for ‘individual buyers with dependents’, with an income cap of $150,000.
  • Relocatable homes that have received a Code Compliance Certificate in the last 12 months can qualify as new properties – increasing the grant amount that applicants can receive.
  • Members of eligible Progressive Home Ownership rent-to-buy schemes can access the new build grant.

CHANGES TO THE FIRST HOME LOAN

  • House price caps have been removed entirely for First Home Loans (income caps and lender requirements still apply), to provide applicants with a greater choice of properties.
  • A new income cap category has been introduced for ‘individual buyers with dependents’, with an income cap of $150,000.

When does this come into effect?

The changes to the First Home Grant take effect from 19 May 2022. The changes to the First Home Loan are expected to take effect from 1 June 2022.

Who is eligible?

The devil is in the detail here, and there are a few hoops to jump through yet. Having an adviser on your side is key to navigating this scheme. We can help you understand the rules, check your eligibility, navigate you though the system and get the best lender for your situation.

Call us on 04 803 3616 to arrange a free consult and check if you are eligible

Book your free consultation with one of the Velocity Team

Did you know? We are paid by our suppliers, so we can offer free advice to you!

I think I may be eligible, what should I do?

Give us a call on 04 803 3616 or book a free consult below with one of our advisers to work out what you need to do to get your house in 2022. Our consults are free.

Book your free consultation with one of the Velocity Team


Ngā mihi,

The Velocity Team 💚





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