KiwiSaver and the First Home Grant: Making Your Savings Work Harder

For many New Zealanders, KiwiSaver represents years of steady saving towards a first home. Combined with the First Home Grant, these two schemes can meaningfully reduce the time it takes to reach a deposit goal. At Chaperone, we regularly see buyers surprised by how much is available to them once they understand the eligibility rules. This article explains both schemes and how they interact, so you can approach your deposit planning with a full picture of the support available.

Using KiwiSaver for Your First Home

If you have been contributing to KiwiSaver for at least three years, you may be eligible to withdraw most of your balance to put towards your first home. You are required to leave a minimum of $1,000 in your account, but everything above that threshold can generally be withdrawn. This applies to both the contributions you have made yourself and the employer contributions that have accumulated over time. The withdrawal is processed through Inland Revenue, and your mortgage adviser or solicitor can help you initiate the application at the right time in the purchase process. Knowing roughly how much is in your KiwiSaver account is a useful starting point when calculating how close you are to your deposit target. Keep in mind that investment returns can affect your balance over time, so it is worth checking the current figure rather than relying on an older estimate.

What Is the First Home Grant?

The First Home Grant is a government scheme administered through Kainga Ora that provides eligible buyers with a cash contribution towards their deposit. For existing homes, the grant provides up to $5,000 per eligible buyer. For new builds, that figure rises to up to $10,000 per eligible buyer. If two eligible people are purchasing together, both can apply, potentially combining up to $20,000 for a new build. These are not loans and do not need to be repaid, which makes them a genuinely useful boost to your deposit.

Eligibility for the First Home Grant

To qualify for the First Home Grant, you generally need to have been contributing to KiwiSaver at the minimum required rate for at least three years. There are also income caps: individual applicants must earn below a set annual threshold, and joint applicants have a combined income cap. Property price caps also apply and vary by region, reflecting different market conditions across New Zealand. It is worth checking the current Kainga Ora website for the specific figures, as these thresholds can be updated.

The First Home Loan Scheme

Closely related is the First Home Loan scheme, also administered through Kainga Ora but offered via participating lenders. This scheme allows eligible buyers to purchase with as little as a 5% deposit by having a portion of the loan guaranteed by the government. Income and property price caps apply here as well. Many first-home buyers find that combining a First Home Loan with their KiwiSaver withdrawal and a First Home Grant brings homeownership within reach sooner than they expected.

Planning Your Withdrawal Timing

Timing your KiwiSaver withdrawal correctly is important. The withdrawal is typically processed a few weeks before settlement, so you need to factor this into your timeline when going unconditional on a property. Your solicitor or mortgage adviser will usually manage this process, but being aware of the lead time helps avoid surprises. Applying for the First Home Grant also takes time, so it is advisable to begin that process well before you expect to be making an offer.

Talking to a Mortgage Adviser

The rules around KiwiSaver withdrawals, the First Home Grant, and the First Home Loan scheme have specific eligibility conditions that can be easy to misinterpret. A mortgage adviser familiar with the New Zealand market can assess your personal situation and make sure you are claiming everything you are entitled to. At Chaperone, we can connect you with advisers who deal with these schemes regularly and can help you put together the strongest possible deposit picture before you begin your search.