Understand the new 5% deposit criteria for First Home Loan and Grants

This week, the Housing Minister announced a number of changes to the government’s program to assist New Zealanders into home ownership.

I have had a lot of enquiries about what the changes are and what they mean - so here is a summary:

  • KiwiSaver HomeStart Grant will be called "First Home Grant"

  • The minimum deposit requirement for the First Home Grant will reduce to 5% for both new and existing homes (currently the minimum deposit is 10%)

  • The First Home Grant can be paid to all buyers who are eligible for the grant. Where there are three or more buyers, the current cap of $10,000 for existing houses or $20,000 for new properties is removed (Note: this is still to be fully understood)

  • The definition for new properties for First Home Grants will be amended to define new properties as properties where the Building Code Compliance Certificate (CCC) was issued less than twelve months before the date of the first home buyer’s First Home Grant application (currently this is six months).

  • Welcome Home Loan will be renamed "First Home Loan"

  • The minimum deposit requirement for First Home Loan will reduce to 5% for both new and existing properties

The above changes come into effect on 1 October from which date Housing New Zealand will become part of a new organisation called Kāinga Ora - Homes and Communities.

Applications will be assessed under the revised criteria from 1 October 2019 so if you tick these boxes and qualify for First Home Grant, have little or any debt, good account conduct and can achieve a 5% deposit from Kiwisaver/Savings + First Home Grant, get in touch for a chat.

Paul Dow - Mortgage Advisor

021 615907