Buying a Home using KiwiSaver

Have you always dreamed of owning your own home, or buying land to build on, but thought you couldn’t afford it?

Well you might be able to turn that dream into a reality. You might be eligible to access one or all of three government home ownership products designed to help people on low or fixed incomes into their own homes.

By combining all three you may have a larger deposit and be able to finance your home purchase more easily.

The three products are:
• KiwiSaver first-home savings withdrawal
• KiwiSaver HomeStart grant
• Welcome Home Loans 

If you've previously owned a home but no longer do so, you also may be eligible for the HomeStart grant, first-home savings 
withdrawal and Welcome Home Loan. 

KiwiSaver first-home savings withdrawal

After a minimum of 3 years membership of a KiwiSaver scheme, first home buyers can make a one-off withdrawal from their KiwiSaver and put this money towards a deposit for a first home. Anyone buying their first home may apply - the withdrawal is not means-tested. Even if you've owned a home previously, you might still be able to qualify if you're deemed to be in a similar financial position to a first-time buyer.

How does the first-home savings withdrawal work?

Following changes introduced on 1 April 2015, you can now withdraw all of your own and all of your employer's contributions plus your tax credits. You must leave at least $1,000 in your KiwiSaver Scheme account after the withdrawal, even if you have not received a $1,000 Kick-Start contribution.

You must intend to live in the property - it can't be used to buy an investment property.

For those not in KiwiSaver but a member of a complying fund, you may be able to withdraw your savings to help you buy your first home. Not all complying funds permit withdrawals for this purpose so you'll will need to discuss this with the trustees of your fund.

What do I need to do to apply for a first-home withdrawal?

If you're a first-home buyer, give us a call on 03 470 1030 and we'll help you with this. Alternatively, you'll need to contact your KiwiSaver provider or complying fund provider to apply.

If you're a previous home owner, you'll still need to apply through your scheme provider, however Housing New Zealand will need to determine whether you meet the eligibility criteria. Call us on 03 470 1030 and we'll help you with this.

The withdrawal is administered by the KiwiSaver scheme providers or relevant complying fund managers and if approved the KiwiSaver funds will be transferred into your solicitor’s trust account prior to settlement to be used as part of the purchase price to the vendor on the settlement date. If the agreement is not completed then your solicitor will repay the funds back to your KiwiSaver provider to be reinvested into your KiwiSaver account.

Housing New Zealand is only involved in the savings withdrawal if you've previously owned a home or land. If you currently own a home or have a share in a property you won't be eligible for this feature.

KiwiSaver HomeStart grant

The KiwiSaver HomeStart grant provides eligible first home buyers with a grant of up to $5,000 for individuals and up to $10,000 for couples to put towards a deposit for an existing home.

If you're purchasing a brand new home, a property off the plans or some land to build a first home on, the HomeStart grant is increased to a maximum of up to $10,000 for individuals and up to $20,000 for couples.

How does the HomeStart grant work?

After three years of regularly contributing to KiwiSaver (of at least the minimum allowable percentage of your total income) you may be entitled to the HomeStart grant.

There is a maximum income cap of $80,000 for single borrowers or $120,000 for couples for eligibility for the grant. There is also a maximum house-price cap in place in each part of the country. This is currently $350,000 for Dunedin.

If you are purchasing an existing/older home, the HomeStart grant is $1,000 for each year of contribution to the scheme:

  • 3 years of contributing = $3,000 (the minimum you can get)

  • 4 years of contributing = $4,000

  • 5 years of contributing = $5,000 (the maximum you can get).

If you're purchasing a new home, a property bought off the plans or land to build a new home on, the HomeStart grant is $2,000 for each year of contribution to the scheme:

  • 3 years of contributing = $6,000 (the minimum you can get)

  • 4 years of contributing = $8,000

  • 5 years of contributing = $10,000 (the maximum you can get).

If you're purchasing land to build a new home on, there is a maximum amount the combined land and new home can cost. 

More details can be found on the Housing NZ Corporation website:

Welcome Home Loan 

(see our separate page that has the details of this)

Further information

  • If you're purchasing land to build a new home on, there is a maximum amount the combined land and new home can cost. There are other eligibility criteria to meet.
  • A home which received its building code compliance certificate less than six months before Housing New Zealand receives a HomeStart application is considered a new home. The certificate must relate to the home as a whole and not only some building work on the home. Buying a vacant residential section and planning to relocate an existing/older house on the site does not constitute a new build property and will only be eligible for a HomeStart grant of between $3,000 - $5,000.
  • In cases of properties being bought off the plans, the HomeStart grant may be paid out prior to settlement to assist you with the initial payment or progress payment required as stated in the agreement you have entered into. In these cases, the grant must be held in trust, in escrow or similar arrangement, with payment to the developer only on settlement. Before signing any contract or agreement, you should always seek legal advice. If you are considering buying a property off the plans, it is highly recommended that you discuss this with your solicitor before signing the agreement. You will also need to ensure that there is a projected completion date stipulated on the contract and that the developer is aware that the HomeStart grant is to be held in trust or in escrow until settlement date.
  • Applications should be sent to Housing New Zealand no later than four weeks/ 20 working days before settlement or any earlier required payment date.
  • If you are looking for your first home but haven’t yet found the right house, you can apply for pre-approval of your HomeStart application.
  • If you live in the house you have bought for a minimum of six months from settlement date or if you use the HomeStart grant to purchase land to build a house on, and live in that house for a minimum of six months from the issue of the code compliance certificate for that house, then the HomeStart grant does not need to be paid back. If you move out before the relevant six month period ends, you may be required to pay the HomeStart grant back, with interest.
  • You can also buy a property with other people, who may or may not be KiwiSaver members. If they are members, you may all qualify for HomeStart grants. However, no more than $10,000 worth of grants will be paid for the purchase of an existing/older property and no more than $20,000 for a new home or for the purchase of land on which a home will be built.
  • You can only receive the HomeStart grant or its predecessor, the KiwiSaver deposit subsidy, once.

Don't hesitate to call us on 03 470 1030 for any help with your KiwiSaver - we're here to help.