Extra money for more first home buyers
By Fisher Funds
09 August, 2016
Last month the government increased both the income and house price caps for KiwiSaver HomeStart grants to ensure it's helping more New Zealanders into their own home. The scheme offers grants of up to $10,000 for an existing house, and $20,000 for a new house to add to a deposit for first home-buyers.
KiwiSaver is a great way to save for your first house and it offers great bonuses to people who qualify. With house prices continuing to rise, these changes are designed to help more first home buyers achieve the Kiwi dream of owning their own home.
The table below details the changes. Take note, there is now a different house price cap for existing and new homes; a further incentive to buy new.
|Old criteria||New criteria
(From 1 August)
|Single person, p.a.||80,000||85,000||+5,000|
|House price caps|
|Rest of NZ||350,000||400,000||+50,000|
|Wellington, Christchurch, Hamilton, Tauranga, Queenstown & Nelson-Tasman||450,000||500,000||+50,000|
|New build home:|
|Rest of NZ||350,000||450,000||+100,000|
|Wellington, Christchurch, Hamilton, Tauranga, Queenstown & Nelson-Tasman||450,000||550,000||+100,000|
KiwiSaver can have a big impact when buying your first home, especially those looking at new homes
Here's an example of how it works ...
Harry and Emily are looking to buy their first home. A brand new $550,000 house built in Hamilton. They both earn $60,000 a year before tax and have been contributing 3% to their KiwiSaver accounts for the last five years.
The above example excludes the impact of investment returns. Harry and Emily have also received employer contributions of 3% (after deducting Employer Superannuation Contributions Tax).
Thanks to KiwiSaver, Harry and Emily now have $55,810 to use towards the purchase price on their new home — without it, their first home may still be a dream.
You can read more about using KiwiSaver to help buy your first home on our website.