NZ First-Home Deposit Guide: KiwiSaver, First Home Loan & LVR Rules

This covers deposit size and the real, current government support available to first-home buyers in New Zealand -- not personalised financial advice, and not a substitute for talking to a mortgage adviser about your own numbers. If you're earlier in the journey, see Navaroa's first-home buying guide for the full roadmap this fits into.

The deposit most people actually need

Standard owner-occupier lending caps at 80% LVR (loan-to-value ratio) -- a 20% deposit -- for most borrowers, under Reserve Bank restrictions on how much high-LVR lending banks can do. In practice, banks can lend up to 25% of their new owner-occupier lending above 80% LVR, which is how a smaller deposit is sometimes still possible outside a dedicated first-home scheme. If you do borrow above 80% LVR, expect a low-equity margin -- typically an extra 0.25-1.00% on your interest rate -- on top of the standard rate.

The one scheme that genuinely changes this: the Kāinga Ora First Home Loan

The Kāinga Ora First Home Loan is the real exception to the 20%-deposit picture: it lets an eligible first-home buyer borrow up to 95% of the property's value (a 5% deposit), with Kāinga Ora effectively underwriting the loan so it doesn't count against your bank's own high-LVR lending cap. Current eligibility includes an income cap of $95,000 before tax for a single buyer, or $150,000 combined for two or more buyers, and it's only available through selected banks and lenders -- check directly with Kāinga Ora or a mortgage adviser for the current participating-lender list and full criteria before assuming you qualify.

KiwiSaver: the other real lever

If you've belonged to KiwiSaver continuously for three years or more, haven't made a first-home withdrawal before, and are buying a home to live in (not an investment property), you can generally withdraw your full KiwiSaver balance minus $1,000 -- your own contributions, your employer's, government contributions, and investment returns, with no maximum cap on the amount. Processing genuinely takes 10-15 working days, so apply at least four to six weeks before you expect to need the funds for settlement, not the week before. See IRD: getting my KiwiSaver funds for my first home for the current application process.

What no longer exists: the First Home Grant

If you've read an older article or talked to someone who bought a few years ago, you may have heard of the First Home Grant -- a cash grant on top of your KiwiSaver withdrawal. It was abolished in May 2024, and there's no direct cash-grant replacement today. The KiwiSaver withdrawal and the First Home Loan above are the two schemes that actually exist right now -- worth knowing specifically so you don't budget around a grant that no longer exists.

Putting it together

A realistic first-home deposit plan combines: your own savings, your KiwiSaver balance (if eligible), and -- if your income fits the caps -- a First Home Loan to bridge the gap to a lender-acceptable deposit. None of these are mutually exclusive, and a mortgage adviser can tell you exactly how they combine against your own income and the specific property you're looking at. Once you've got a realistic number, Navaroa's first-home buying guide picks the journey back up from there -- choosing where to buy, making an offer, and the moving-in stage.