Kiwisaver Homestart Grant
This article was written by Sue McDonnell-Golds
Buying your first home with KiwiSaver
After three years of regularly contributing to KiwiSaver (of at least the minumum allowable percentage of your total income) you may be entitled to the HomeStart Grant. The default rate is currently 3% and this is the minimum that you must contribute.
We suggest you visit www.kiwisaver-homestart.co.nz/calculator to obtain an estimate of the amount of Grant you might be entitled to.
You can apply for the HomeStart Grant or pre-approval for the Grant, if you have belonged and contributed to a KiwiSaver scheme, complying fund or exempt employer scheme for at least three years.
If you are purchasing an existing or older home, the Grant is $1,000.00 for each year of your contribution to the scheme:
- 3 years of contributing = $3,000.00 (the minimum you can get)
- 4 years of contributing = $4,000.00
- 5 years of contributing = $5,000.00 (the maximum you can get)
If you are purchasing a new home, a property bought off the plans, or land to build a new home* on, the HomeStart grant is $2,000.00 for each year of contribution to the scheme:
- 3 years of contributing = $6,000.00 (the minimum you can get)
- 4 years of contributing = $8,000.00
- 5 years of contributing = $10,000.00 (the maximum you can get)
*If you are purchasing land to build a new home on, there is a maximum amount the combined land and new home can cost and other eligibility criteria to meet.
Please refer to www.hnzc.co.nz/buying-a-house for further information.
Housing Price Caps
$500,000.00 in Christchurch, Selwyn, Waimakariri, Western Bay of Plenty, Tauranga, Hamilton, Kapiti Coast, Porirua, Upper Hutt, Lower Hutt, Wellington, Nelson, Tasman and Queenstown.
$600,000.00 in Auckland.
$400,000.00 for the remainder of the country.
$550,000.00 in Christchurch, Selwyn, Waimakariri, Western Bay of Plenty, Tauranga, Hamilton, Kapiti Coast, Porirua, Upper Hutt, Lower Hutt, Wellington, Nelson, Tasman and Queenstown.
$650,000.00 in Auckland.
$450,000.00 for the remainder of the country.
Income Level Caps
$85,000.00 for a single buyer.
$130,000.00 for a couple.
A minimum of four weeks (20 working days) is required between receipt of the application and the date of payment of funds required for settlement of the purchase. If you apply for the Grant to meet the financial conditions of an agreement for sale and purchase, you must allow at least 10 working days prior to the date the agreement is due to be confirmed as unconditional.
Applications that do not provide the required four weeks’ notice, may not be accepted and the Grant may not be paid out. The Grant cannot be paid out after settlement has taken place.
If you are looking for your first home, but have not yet found the right house, you can apply for pre-approval of your HomeStart application.
You can buy a property with other people who may or may not be a KiwiSaver member. If they are members, they may all qualify for HomeStart Grants. However, no more than $10,000.00 of total grant will be paid for the purchase of an existing or older home, and no more than $20,000.00 for a new home or for the purchae of land on which a home will be built.
A second chance home buyer may access the Grants but, like first home buyers, you will have to meet the income cap. Your assets must be worth less than 20% of that area’s regional price cap and must not have previously received a KiwiSaver subsidy or Grant.
It is important that the application forms are completed correctly and that all additional information provided with the application is correct and up to date.
In particular, to avoid delays in processing the application, you should ensure that:
- The income certificates are for the last 12 months, not the last financial year
- Income certificates are provided for all named or intended purchasers
- You provide a detailed KiwiSaver contribution statement that covers the period you have contributed to KiwiSaver
- You provide evidence of a deposit of at least 10% of the purchase price if you have already entered into a sale and purchase agreement
- The correct application has been completed
The KiwiSaver First Home Withdrawal is administered by participating KiwiSaver Providers and you need to contact your KiwiSaver provider for information regarding withdrawal of funds.