{"id":4135,"date":"2023-05-28T21:06:32","date_gmt":"2023-05-28T09:06:32","guid":{"rendered":"https:\/\/metafinancial.co.nz\/?p=4135"},"modified":"2023-07-11T10:52:30","modified_gmt":"2023-07-10T22:52:30","slug":"buying-your-first-home-in-new-zealand","status":"publish","type":"post","link":"https:\/\/metafinancial.co.nz\/buying-your-first-home-in-new-zealand\/","title":{"rendered":"Buying your First Home in New Zealand"},"content":{"rendered":"\t\t
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Buying your First Home in New Zealand<\/h2>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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How to make sense of the current property market and available incentives to help you into a home sooner plus 7 quick tips for first home buyers.<\/h5>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t
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Recently there has been a shift in the New Zealand housing market. Buyers have more things in their favour, with an increase to house price caps for Kainga Ora’s First Home Grant and banks opening their loan books to buyers with less than 20% deposit. As there are more buyers than sellers currently it is known as a ‘buyers market. There are many new-build developments complete and waiting for buyers and olders homes are taking longer to sell. There is a lot happening, that’s why we’ve put together this article to help you make sense.\u00a0<\/h3>

Our free first home buying guide ‘First Home Masterplan<\/a>‘ is available to download as an e-book too.<\/h3>

7 Quick Tips for First Home Buyers.<\/strong><\/h3>

Buying your first home may seem daunting. Always keep in mind that thousands of New Zealander\u2019s have achieved this goal<\/strong> before you. Even if the banks says no or you think you will be years away from buying a home, we can help. Here are 7 quick tips for first home buyers and the links to check your eligibility. We have further explained some of these within this article:<\/p>

  1. You can buy a first home if your deposit is less than 20% of the home\u2019s value.<\/li>
  2. Most banks require part of your deposit to come from savings such as KiwiSaver or cash.<\/li>
  3. You can top-up your deposit with cash gifts from friends or family.<\/li>
  4. If you are a KiwiSaver member you can use your savings for your deposit.<\/li>
  5. You can buy a first home if you have a student loan, vehicle finance or hire purchases.<\/li>
  6. If you are eligible for the K\u0101inga Ora First Home Grant<\/a>, you could receive up to $10,000 for your deposit.<\/li>
  7. You can buy a first home with your friends or family.<\/li><\/ol>

    Mortgage Lending Rules Softened by the Reserve Bank in June.<\/strong><\/h3>

    The Reserve Bank (RBNZ) has altered the mortgage lending rules that the main banks in New Zealand must follow. They have indicated that on June 1, 2023, the banks will be able to lend to more borrowers with less than 20% deposit<\/strong>. The RBNZ have lifted the cap, from 10 per cent to 15 per cent, of new mortgage lending for the banks. Economic and real estate commentators have mentioned that this will likely increase first home buying activity throughout New Zealand. If the banks have more money to lend out, they will be aggressive in promoting this \u2013 they need to lend money to make a profit. We think this will lead to increased options for first home buyers.<\/p>

    Let’s Talk Deposit – How Much do we Need to Buy our First Home?<\/strong><\/h3>

    A deposit is the total amount of money are putting towards the house purchase. The remainder of the money will come from the bank. You don\u2019t have to keep saving until you have a 20% deposit<\/strong>. Banks are able to lend you the money for a home loan with a 10% deposit. It may be scary for you to think about, but you can buy a home for $1 million dollars if you have $100,000 deposit for example.<\/p>

    There are initiatives available through K\u0101inga Ora<\/a> to buy with a deposit of 5%, which means you could buy a $1 million dollar home with a $50,000 deposit. This is called a First Home Loan. Have a read of our guide on the First Home Loan<\/a> then get in touch if you think you might qualify. We will assist you to ensure you meet K\u0101inga Ora and the participating bank\u2019s lending criteria.<\/p>

    Our team complete the assessment to determine what size home loan you can afford. If you have $100,000 as a deposit as per the above example, we then ensure you can pass the bank servicing criteria for a $900,000 mortgage.<\/p>

    There are a few more hurdles to jump through if you buy with less than 20% deposit, but we are experienced in answering all the banks\u2019 questions<\/strong> and will guide you through this.<\/p>

    Later on in the home buying journey we will talk about the 2 types of deposit when buying a home<\/a> because you don\u2019t need to pay your total available deposit to the Real Estate Agent when you\u2019re ready to make an offer.<\/p>

    What Can We Use as a Deposit?<\/strong><\/h3>

    Your deposit can be made up of money from various sources. 4 of the most common options are shown below. These could include savings; KiwiSaver, First Home Grants or a cash gift or loan from friends or family. Non-bank lenders will also let you borrow money if you are short for your deposit. \"\"<\/span><\/p>

    Talk to our team if you need advice on what you can use as a deposit and how to pull it all together.<\/span><\/p>

    K\u0101inga Ora\u2019s First Home Grant Programme<\/strong><\/h3>

    Kainga Ora\u2019s First Home Grant helps eligible first home buyers with their deposit<\/strong>, by offering a government contribution of up to $10,000 per person (or $20,000 for a couple buying together). How much assistance for your deposit is determined by how long you\u2019ve been in KiwiSaver and whether you buy a new or existing home. Did we mention you don\u2019t have to pay this back!<\/p>

    Eligibility for the grant depends on a few different things:<\/p>