Financial boost for first-home buyers
The Government is giving a boost to first home buyers looking to get on the property ladder by allowing them to earn more and search for a home in a more realistic price range with the KiwiSaver scheme.
From today, income caps will increase from $80,000 to $85,000 for a single person, and from $120,000 to $130,000 for a couple wanting to use the KiwiSaver HomeStart scheme, Building and Housing Minister Nick Smith said.
The programme is about ‘‘helping first-home buyers pull together a deposit with a grant of up to $10,000 for an existing house and $20,000 for a new home,’’ Smith said.
‘‘We are adjusting the income and house-price caps to take into account increases in both since the scheme was announced so as to ensure it achieves its objective of helping middle-income earners into a modest home.’’
House-price caps will increase by an extra $50,000 from the existing $350,000, $450,000 and $550,000 depending on region and to $450,000, $550,000 and $650,000 for a new home.
‘‘This reflects the $50,000 increase in the national median house price since the scheme began,’’ says Smith.
The highest price caps apply only to Auckland, the median tier covers Wellington, Christchurch, Hamilton, Tauranga, Queenstown and Nelson-Tasman, and the bottom tier is the rest of the country.
But Labour leader Andrew Little says while anyone outside of Auckland will welcome the changes, ‘‘for those in Auckland, the Government’s failure to address the housing crisis means houses are simply not being built for $650,000’’.
Despite first-home buyers needing all the help they can get, $10 million in subsidies were not taken up last year because of Auckland’s skyrocketing house prices, Little said.
‘‘Only 9 per cent of the subsidy was going to Aucklanders because it is so hard to find a house there for under $600,000.’’
The increases in income and house-price caps will also apply to the Welcome Home loans scheme – this allows first home buyers to purchase with a 10 per cent deposit. ‘‘A couple who are each on the average income of $60,000 will, after five years in KiwiSaver, now be able to withdraw $45,000 from their KiwiSaver accounts and obtain a HomeStart grant of $20,000 if they’re buying a new build,’’ Smith said.