Government urged to better promote its first-home buyer assistance schemes

Many Kiwi homeowner hopefuls are unaware of the different government assistance available to help them get onto the property ladder, said Tim Kearins, owner of Century 21 New Zealand, as he urged the government to better promote these schemes. 

Government assistance schemes include First Home Grants, First Home Loans, and First Home Partner.

First Home Partner is a shared ownership scheme aimed at aspiring first-home buyers whose deposit and home loan aren’t quite enough to buy a home that meets their needs. The program enables them to buy a home together with Kāinga Ora.

“For example, a couple secures $620,000 for a $730,000 purchase, and Kāinga Ora stumps up with the $110,000 difference,” said Julius Capilitan (pictured above), managing director of Century 21 Financial. “Both parties then enter a shared ownership agreement. It’s an attractive scheme that’s helping a lot into their first home and well worth investigating.” 

Last year, to better reflect market prices, the government raised the house price caps for the First Home Grant and entirely removed house price caps from the First Home Loan.

First Home Grants offer eligible first-home buyers up to $20,000 for a deposit while First Home Loans enable eligible buyers to buy a home with a 5% deposit with no price caps.

“For sure it’s harder for buyers with less than a 20% deposit to get finance due to the Reserve Bank’s loan-to-value ratio (LVRs) restrictions, but these schemes make it much more possible to secure a mortgage,” Capilitan said. “My advice is talk to a broker, but first get on the Kāinga Ora website to understand their products better and see if you’re eligible.”

Capilitan said most buyers hungry enough will get finance to buy a property. 

“We’re still seeing plenty of approvals from banks, despite what you may hear,” Capilitan said. “There are always exemptions to the rules and while it’s never easy, it’s certainly not getting harder.”  

Kearins said coming up with a sufficient deposit is often the biggest hurdle, given the current cost of living crisis. He urged the government to better promote its first-home buyer assistance.  

“There are no silver bullets to homeownership, but these schemes certainly help many young Kiwis get over the line,” he said. “Given the opportunities for buyers out there, this winter may prove to be the best time in a long time to get on the property ladder.”

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