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New Zealand First Home

First Home

Buying your first home can be challenging

There's a lot to know when it comes to getting a home loan. On this page, we cover everything specific to first home buyers. For more general information visit our home loan page.

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Borrowing Process

Looking to buy a house? Understanding your mortgage process is a great place to start. A pre-approval gives a good insight into the price range of houses you should be looking at.



Lenders will assess your loan application on a range of factors. The first stage is looking to see if you have at least a 5% deposit. This page discusses the deposit requirements and government sources that can contribute to your deposit below.



Lenders then need to assess your ability to repay the loan. For buyers with less than 20% deposit the perceived risk to lenders is high so income requirements are strict. As a result, this is a point where many are declined by their current bank and become discouraged. However, there are ways to overcome this. Your ability to repay the loan will be based on your income, or profit if you are a sole trader. This income can be supplemented by including borders, which is essentially renting out your own property while you remain living there.

Your income will be considered relative to your expenses. Reducing your expenditure is one way to increase your ability to repay the loan. A common way which mortgage brokers work around being declined is to make the application conditional upon certain expenses decreasing.



The Lender will also look at your personal characteristics to determine risk. This will include conducting a credit check that could reveal something that potentially harms your application. This is generally able to be overcome with a well put together application.



For the lender, there is a risk that the borrower will not repay the debt so they ‘secure’ the loan. A mortgage outlines that the lender takes over the title of the property, so in the event the borrower defaults their payments, the lender can recover their investment through forcing a sale. This means that the property is acting as a security for the loan.

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Less than 20% Deposit

For an owner-occupied property the deposit which lenders generally require is 20% of the purchase price. However, under the First Home Loan initiative then it is possible to be approved with a deposit of 10% and as low as only 5%. In order to qualify under the First Home Loan, you will need to meet the following conditions


 > You must be a first-time buyer and intend on living in the property you are looking to purchase

 > Annual before tax income must be less than $95,000 if you are the sole borrower, and less than              $150,000 combined if you are purchasing with others.

 > Within the regional house price caps which can be found on the Kainga Ora website.


A minimum of 5% deposit must come from personal savings but additional funds could be donated by a family member or come from a range of sources. A less than 20% deposit is more strict on other parts of the application including servicing requirements and additional documentation for the security. This includes the requirement of a registered valuation of the property which is often at the expense of the borrower.


Just because your bank may have declined your application for lending, this does not mean you don’t have other options. Discuss with a specialist to see how these problems can be overcome.

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If you’re buying your first home, you will likely be eligible to withdraw your Kiwisaver. In order to release your funds, you will need to meet the following conditions.

> You must have been contributing to Kiwisaver for at least 3 years

> You cannot have withdrawn any Kiwisaver funds before

> You must be a first-time buyer and intend on living in the property you are looking to purchase


If you meet these conditions, then you are able to withdraw of your Kiwisaver balance except for the initial $1000 government Kickstarter which must stay in the account.

There are some circumstances where, if you have owned a house before but are in the same financial position as a first home buyer, then you may be eligible to withdraw your Kiwisaver again.

It is worth noting that the release of these funds can take up to 6 weeks to be drawn down to the lawyer.

Kāinga Ora first home grant

Buying your first home is a huge financial commitment and it can be challenging to get a suitable deposit. Kāinga Ora has been established to make it easier for first home buyers to purchase a property. Under the First Home Loan, you only need a 5% deposit rather than the 20% required by most lenders. As part of this initiative, a first home grant distributed by Kāinga Ora can be paid to you to increase your deposit.

The money received from Kāinga Ora is not required to be paid back but the amount you receive is based on your contribution to Kiwisaver. In order to be eligible for the First Home Grant, you will need to meet the following conditions.


> Income for a single borrower must be under $95,000

> Income for a couple or group of borrowers that are purchasing the property together must be                   under $150,000 combined

> The property price must be within the house caps specific to that region, which can be found here.

> Must have been contributing to Kiwisaver for at least 3 years

The grant you receive will be based on how many years you have been actively contributing to Kiwisaver. When purchasing an existing property, you can receive $1000 for every year you have contributed into Kiwisaver, between 3 and 5 years. For a new build or new property, you can receive $2000 for every year you have contributed, between 3 and 5 years. To see if you are eligible for the First Home grant, visit the Kāinga Ora website.

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How can our specialists help?

As you now know, there is a lot to think about when it comes to getting a loan. Fortunately, we are here to help you through this process. 

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