Kiwisaver has a wonderful benefit available for first home buyers. It works like this – you must be in Kiwisaver for a minimum of 3 years paying at least the minimum contribution from your wages before you are eligible to withdraw your funds as a deposit on a home.
You may withdraw all of your Kiwisaver savings towards your house deposit, less the $1,000 government kickstart. You will need a statement from your Kiwisaver provider – this is readily available on enquiry with your Kiwisaver provider.
Check out more information about withdrawing Kiwisaver here: https://kaingaora.govt.nz/home-ownership/kiwisaver-first-home-withdrawal/
In addition to being able to withdraw your and your employer’s contributions from Kiwisaver, there is also a one-off Homestart grant available from the government. For purchasing an existing home, the grant is between $3,000 and $5,000 based on $1,000 each year of Kiwisaver membership. For building or purchasing a brand new home, or for purchasing land to build a new home on, the grant is doubled to $2,000 per year of membership, up to a maximum of $10,000 for five years for each member.
This means that a couple who have each contributed to Kiwisaver for five years could receive $20,000 towards the purchase of a brand new home – and this is on top of their Kiwisaver withdrawal!
Check out further information about Homestart grant here: https://kaingaora.govt.nz/home-ownership/first-home-grant/check-you-are-eligible-for-first-home-grant/
Note that the following qualifying criteria applies to Homestart grant:-
- You can not have a combined income of greater than $85,000 (1 borrower) or $130,000 (2 or more borrowers).
- The maximum house purchase price value is $500,000 in Wellington city, Hutt City, Upper Hutt, Kapiti Coast and Porirua City (or $550,000 for a brand new home).
- Buyers must have a deposit that is 5% or more of the purchase price, including the addition of the grant.
- You must plan to live in the house for at least 6 months from the settlement of the property.
- Some second home buyers can qualify if they can prove they are in a similar financial position as a first home buyer (generally have been financially impacted by a matrimonial split).
If you do not qualify for the Homestart grant, you can still withdraw from your Kiwisaver account.
Your lawyer has to action the Homestart grant and the Kiwisaver withdrawal process, as funds have to be controlled to ensure they are used exclusively for the house purchase. Note there is a minimum 10 working day turn-around for withdrawal of both (best to allow longer) and funds are not available to be used as the deposit on the house purchase contract.