OneRoof first home buyer's guide: What grants do first home buyers get?

(PART ONE)

contribute 3%, 4%, 6%, 8% or 10% of your before-tax pay to a provider and fund of your choice. Your employer should contribute 3% as well. You can also make regular or one-off voluntary contributions to KiwiSaver. If you’re unemployed or self-employed, you can make voluntary contributions.

The Government contributes 50c for every $1 you save each year up to $1042.86. That means up to $521.43 of free money, which then compounds and grows over time, boosting your deposit. The annual cut-off date for KiwiSaver contributions is June 30.

Your savings and employer/government contributions are invested by your fund provider and grow over time. Typically, the return is higher than you’d get in a term deposit and you pay less tax than you would on a standard savings account, meaning your money grows faster.

Because KiwiSaver is locked in, it’s a great way to stop you from dipping into savings whenever you’re tempted. Your savings and contributions from your employer and the government can only be accessed for First Home Withdrawal, and other very specific circumstances such as financial hardship, permanent immigration, and serious illness.

How does the First Home Grant work?

The First Home Grant is overseen by Kaˉinga Ora and provides up to $10,000 per couple towards the purchase of an existing first home or $20,000 for a brand-new home.

You can only receive the First Home Grant once. That includes its predecessors, HomeStart grant or KiwiSaver deposit subsidy.

To be eligible you need to:

• Have saved at least 3% of your total income into your KiwiSaver for a minimum of three years

• Earn less than $95,000 for a single or $150,000 for two buyers or an individual buyer with one or more dependants

• Choose a home that falls under the current purchase price cap for the area

Under the First Home Grant, first-home buyers looking to purchase an existing home are each eligible to receive up to $1000 per year from their three-year savings mark, capped at $5000. Those looking to buy a new home or land will qualify for $2000 per year up to $10,000 each. Where two people are buying the house and both qualify, the grant is doubled.