Finding a first home that perfectly suits your lifestyle and fits your requirements should be a fun and exciting time. It will also be one of the biggest financial decisions you will make. Careful planning and an understanding of the options available to you is critical. This will ensure you are in the best possible position to commit to purchasing that dream home.

The pressure of funding a deposit is one of the biggest hurdles you may face. Check out our blog for tips on how to save a deposit.  Fortunately, there is funding to help you towards your goal. If you or your partner are members of the KiwiSaver scheme, you may be eligible for the KiwiSaver HomeStart grant which is designed to help first home buyers with the initial deposit on a house.

KiwiSaver HomeStart grant, what is it?

The KiwiSaver HomeStart grant is part of the KiwiSaver scheme. It provides eligible first-time home buyers with a financial contribution to help them purchase a property.

The grant enables individuals to receive a sum of up to $5,000 and up to $10,000 if there are multiple parties involved in purchasing an existing property.

If an individual is purchasing a block of land or intending to build a new property, they are eligible for a grant of up to $10,000 and up to $20,000 if there are multiple eligible parties involved.

Am I eligible for the KiwiSaver HomeStart grant?

There are several key criteria that you must meet in order to be eligible to receive the KiwiSaver HomeStart grant:

⦁ Must be 18 years or older

⦁ Have not previously received the KiwiSaver HomeStart grant

⦁ Have contributed the required minimum payments to your KiwiSaver over the past 3 years (which is 3% of your before-tax income)

⦁ Have a total before-tax income of less than $85,000 for individual buyers or $135,000 for two or more buyers

⦁ Have a deposit of at least 10% of the initial asking price of the intended purchase property

Is the property I’m purchasing eligible?

It is vital to ensure that not only are you or your partner is eligible for the KiwiSaver HomeStart grant but that the property or land is also eligible for you to receive the grant. There are several key criteria that the property or land needs to meet as well:

⦁ The property or land will be your first and only house at the time of purchasing

⦁ The property is not an investment; it must be your primary place of residence for at least 6 months after purchase.

⦁ The property must be under the maximum house price cap for the scheme. This will vary depending on the region in which you are intending to make the purchase. It is critical that you understand the upper limits of the price cap and the difference between older or existing properties and new properties for your region.

If you have previously purchased property, you may still be eligible, as long as you no longer own the home, are in a similar position as a first home buyer and have not used your KiwiSaver or HomeStart Grant for any previous property.

Applying for the HomeStart grant
You are able to apply for the grant if you have already made an offer or have agreed upon sale terms on a property or piece of land. You can also apply for pre-approval if you are still in the process of looking for a property or piece of land to purchase.

The application process for the KiwiSaver HomeStart grant is fairly simple and can be completed online through Housing New Zealand’s website, but as with any big life decision, it’s important to have a trusted adviser on hand to ensure you have a full understanding of the process to receive the best outcome. The application process takes up to four weeks to process and distribute the allocated funding.

Purchasing your first home should be a fun and exciting time but an understanding of how you can maximise potential savings is vital to reduce the financial stress of the process. Get in touch and we’ll help make it a seamless and beneficial one.