First Home Partner

There’s been some pretty exciting changes recently announced to the First Home Partner scheme which are set to take effect from the 14th of August 2023. Listen up FHB’s because this is a game changer! And could seriously make that dream of getting into your first home a reality! 

What exactly is the First Home Partner Scheme?

First Home Partner is a shared ownership scheme to help aspiring first-home buyers. If your deposit and home loan aren’t quite enough to buy a home that meets your needs, you may be eligible to purchase a home together with Kāinga Ora. Along with recently raising the household income cap for eligibility from $130,000 to $150,000; Kāinga Ora have also now allowed the scheme to extend to existing homes as opposed to the previous new builds only criteria. This is intended to provide buyers with a greater choice of homes.

How does it work?

The partnership scheme means Kāinga Ora will bridge the gap up to 25% of the value of the property, or up to $200K, whichever is the lower amount. You will need to meet the lending requirements of a participating bank to receive a home loan (we can help with that!) and be able to contribute a minimum of 5% of the purchase price of the home you are interested in buying. This could be through any money you may have saved in the bank, KiwiSaver first-home withdrawal, First Home Grant or the bank of Mum and Dad. 

Kāinga Ora own a share of the home (up to 25%) which you don’t need to pay back (interest free) until the 20th anniversary from the date of settlement on the home or if you sell the property. From the 20th anniversary an annual administration fee will be charged by Kāinga Ora and you have 25 years to refinance or repay the equity share.   The amount required for your payment is determined by the value of the home at the time. This means that, if the value of the property has increased 10% from when you originally purchased it, the share of the home Kāinga Ora owns will cost 10% more to purchase.

Shared ownership won’t feel very different from full home ownership from day-to- day. You are the majority homeowner, and Kāinga Ora will not use or occupy your home. However, you do need to commit to residing in the home for at least three years and you will need to ask permission from Kāinga Ora before making any improvements or reno’s, or if you want to sell your property. 

The Government has committed 400 million to this fund and are wanting to hit their sign up targets by June 2024; meaning we don’t know how long this scheme will be around for. We see it as a really good way to help FHB’s get on the property ladder so time is of the essence! 

If you’ve felt like getting on the property ladder was just too far out of reach, this could be the opportunity you’ve been waiting for! As always every set of circumstances are unique so you’re best to get in touch and we can work through the steps with you.