KiwiSaver is a great way to save to buy your first home. Currently, the government offers two ways to help you do this:

• First home withdrawal
• First home subsidy

First home withdrawal

The basics

If you have never owned land or a house before, either by yourself or with someone else, you may qualify to take money out of KiwiSaver to help buy your first home.

To be eligible to make a first home withdrawal from your KiwiSaver Account:

• You need to have been a member of a KiwiSaver scheme for at least 3 years (note: the 3 years is the membership period and not the savings period), and
• The house you are purchasing must be intended to be your principal place of residence.

You must also have not made a withdrawal from KiwiSaver for this purpose before.

The first home withdrawal lets you take out more than just the money you have personally saved. If you are eligible to make a withdrawal, you can withdraw everything in your KiwiSaver Account except the government-paid money, (i.e. the $1,000 kick-start and the $1 for $2 MTCs (Member Tax Credits)). This means you can withdraw all of your savings, the contributions by your employer and all of the investment earnings in your KiwiSaver account.

 The 3 year membership requirement

Three years’ membership is a specific requirement. Where a person was auto enrolled in KiwiSaver and did not make a specific decision to join a KiwiSaver scheme until they started saving, the start of the 3 year period applies from the 15th day of the month their contributions were first deducted from their pay. In other cases, it is when they first joined a KiwiSaver scheme.

 Special provisions

If you have owned a house before, you may still qualify, if the Minister of Housing considers that your financial situation, in terms of your income, assets and liabilities, is the same as what would be expected for a person who has never owned a home. In this case, you need to get a certificate from Housing New Zealand verifying this.

 More information

If you would like more information about buying your first home through KiwiSaver, read SuperLife's article about first home withdrawals.

 First home subsidy

The basics

If you are eligible for the first home withdrawal under KiwiSaver, you may also be eligible for the first home subsidy. The first home subsidy is separate from the first home withdrawal payment. It is managed by Housing New Zealand and not the KiwiSaver provider.

The first home subsidy is $1,000 for each year you have saved in KiwiSaver, with a maximum of $5,000. The maximum applies after 5 or more years’ savings. The 5 years do not need to be consecutive. Where two people apply together, both can qualify individually for the maximum. 

Eligibility

To qualify, you must have been saving in KiwiSaver for at least 3 years and your savings must have been at least 2% of your taxable pay. For non-working people, the savings have to have been at least 2% of the minimum wage (about $510 savings a year). From 1 April 2013 the 2% becomes 3%. Couples can both qualify individually. In fact, up to three people can apply a subsidy for the joint purchase of a house.

 The rules

• Your household income must be below $100,000 if two or fewer people are buying the home and below $140,000 if there are three or more buyers.
• The value of the house must be below $300,000 ($400,000 in Auckland City, North Shore City, Rodney District, Wellington City and Queenstown Lakes District).
• If you are buying land to build a house, or buying an apartment not yet built, the house/apartment must be built within 12 months of the purchase of the land. You also need to be able to show the availability of the necessary funding required to build the house/apartment.

 More information

If you would like more information about the first home subsidy, read our article on first home subsidies.

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