The Mackenzie housing market can be a challenge for first home buyers.
But things have started to swing in their favour in recent months. Between a more even market, and record levels of residential construction, we are seeing choice available in themarket, and there are some good deals to be had.
And last week’s Budget announcement has brought more good news – with the Government unveiling details of a number of key changes that will unlock additional (and much-needed) support for the first home buyer market.
- A healthy increase in house price caps for Kāinga Ora’s First Home Grant programme
Kāinga Ora’s First Home Grant programme helps eligible first home buyers bulk out their house deposit, by offering a government contribution of up to $10,000 per person
(or $20,000 for a couple)*.
Eligibility for the grant depends on a few different things.
- You must have contributed at least 3% of your income to a KiwiSaver scheme for at least three years;
- You must be planning to live in the house for at least six months;
- You must have a single income up to $95,000 or a combined yearly income of $150,000 or less (before tax) for two or more applicants;
- And you must be buying or building a house under the regional house price caps.
And it’s that last point which has changed for the better with this week’s Budget announcement.
House price caps have been increased across large parts of the country – bringing them in line with regional lower quartile house prices, after a period of bumper price growth across New Zealand’s housing market.
In Twizel, Tekapo, Omarama, the new cap now sits at $875,000 for existing properties and new builds at $925,000, up from $400,000 and $500,000 respectively.
These changes have come into effect immediately, offering more support and greater choice to Kiwis hoping to get settled into their very own first home.
* Note: Just how much you can get for your First Home Grant is determined by how long you’ve been in KiwiSaver, and whether you’re buying an existing property or buying / building new. Check out Kāinga Ora’s website for the specifics.
- The removal of house price caps on Kāinga Ora First Home Loans
Kāinga Ora underwrites the loans, and works with a select group of banks and other lenders to coordinate funding.
In an environment where that golden 20% deposit has felt increasingly out of reach for many, and tightened LVR restrictions have made life that much harder for low-deposit borrowers, it’s a unique solution for those who would struggle to meet traditional lending criteria.
Previously, to be eligible, you had to (among other things) be looking at buying a house valued at less than those regional house prices caps we mentioned earlier.
But, as of Wednesday 1st June, those caps will no longer apply, significantly increasing choice for eligible first home buyers.
For more information about the programme, and eligibility, check out Kāinga Ora’s website.
- More regular reviews of price and income caps moving forward
Finally, and appropriately given the ever-changing state of our housing market, the Government have committed to reviewing the house price and income caps on a six-monthly basis – ensuring they stay more up-to-date.
- Ready to go ?
Look online for current options in the marketplace and talk to your Broker to get your preapproval underway.