You’re looking to buy your first home, but you aren’t quite sure of the specifics of drawing down on your KiwiSaver. Here are the basics of what you need to know, including some useful links for further reading.
How do I withdraw?
You can withdraw your KiwiSaver for your first home by making a request from your KiwiSaver provider. Each will have their own process, but you must fulfil certain criteria before being able to withdraw regardless of your provider. This includes:
- You must have been in the KiwiSaver programme for at least 3 years.
- You must be a first-time property or landowner.
- The property or land must in New Zealand.
- You must be building or buying a home to be your family home i.e. not an investment property.
- It must be the first time you are withdrawing to buy a home.
If you fulfil all of these requirements, get in touch with your provider. If you’ve previously owned a home, check out the guidance over at Housing New Zealand to weigh up your options for withdrawal.
How much can I withdraw?
You will be able to withdraw nearly all of the money in your KiwiSaver, including your own contributions, employer contributions, and any government top-ups you may have benefitted from.
However, you must leave at least $1,000 in your KiwiSaver when drawing for a first home. Keep this in mind when planning your purchase.
On a similar note, as of the time of writing, you do not need to pay any kind of tax when accessing your KiwiSaver. What you drawdown is what you get to use for your deposit.
What grants can I get?
By being part of the KiwiSaver programme, you get access to the HomeStart Grant offered by Housing New Zealand.
This grant can grant you up to $5,000 if you are buying an existing home or up to $10,000 if you are building or buying a brand new home (off-the-plan, etc). This also applies to any partner that may be purchasing with you, giving couples up to $20,000 to put towards their deposit for a new home, or $10,000 for an existing one.
There are some approval conditions, however, based around how long you’ve been contributing to KiwiSaver, how much you (and your partner) earn, how much of a deposit you have, and so on.
For an overview of all the terms and conditions, we recommend you read up over at the main HomeStart webpage.
You may also want to investigate your options in the Welcome Home loan. This is not technically through KiwiSaver, but it’s a valuable additional consideration for first home buyers.
For more information on getting into your first home faster, get in touch with the Money Empire team today.