Prime Minister

The National-led Government’s HomeStart programme took effect on 1 April this year, and will help tens of thousands more first home buyers and young families into a home of their own over the next five years.

It will encourage the building of new, affordable homes and help New Zealand families get a deposit together for a house.

HomeStart complements the wide programme of work the Government already has underway to help New Zealand families.

Helping more people buy their own home will provide stability for families, strength for communities and security in retirement.

The National-led Government will:

  • Help about 90,000 lower and middle income first home buyers into their own home over the next five years – 40,000 more than would be helped under current policies.
  • Replace the KiwiSaver First Home Deposit Subsidy with a KiwiSaver HomeStart grant, doubling the support for buying a new home and increasing the house price limits:
    • Couples will now be able to apply for a KiwiSaver HomeStart grant of up to $20,000 if they are buying a brand-new house, or $10,000 if they are buying an existing home, under the house price limits.
    • Increase house price limits for the KiwiSaver HomeStart grant to $550,000 in Auckland, $450,000 in Wellington, Christchurch, and similarly-priced markets, and $350,000 for the rest of the country.
  • Enable larger KiwiSaver First Home Withdrawals by including the member’s tax credit (meaning first home buyers will now be able to withdraw all of their KiwiSaver savings except the $1000 kick-start).
  • Expand eligibility for Welcome Home Loans by aligning the house price limits with the new KiwiSaver HomeStart grant. Welcome Home Loans allow people to buy a home with a lower deposit than is normally required – generally you only require a 10 per cent deposit.
  • Encourage greater supply of affordable new housing. HomeStart complements our work that is freeing up land supply, reducing building material costs, reining in infrastructure and compliance costs, and investing in sector skills and productivity.

How it will work

Using an example of a couple both earning $40,000 a year – for example in South Auckland.

They’ve been in KiwiSaver for five years, and are looking to buy a first home that’s under the price limit.

Under HomeStart, they could together withdraw up to $29,000 from their KiwiSaver accounts, and get either a $10,000 or $20,000 HomeStart Grant, depending on whether they’re buying an existing or a new home.

In total, that means a deposit after five years of almost $40,000 – or almost $50,000 if they are buying new.

That would be enough on its own to get a Welcome Home Loan for a house costing up to $400,000 or up to $500,000 if new – depending, of course, on their ability to service the mortgage.

More information