How to use KiwiSaver to buy your first home

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If you’ve been a member of KiwiSaver for more than three years you may be able to use part of your balance to purchase your first home. This chunk of cash may be what you need to get a leg up onto the property ladder but there are a few hoops you need to jump through before you can use it. 

Am I eligible to withdraw my KiwiSaver to buy my first home?

To withdraw your Kiwisaver balance you must be buying your first home, not an investment. You must also:

  • Be buying land or property in New Zealand.
  • Plan to live in the home you buy or build. 
  • Have never withdrawn your KiwiSaver balance to buy your first home. 

In some cases, if you have purchased a home before but you are in the same financial position as a typical first home buyer you may be permitted to use your KiwiSaver balance to buy a property. You’ll need to contact Housing New Zealand to check if you’re eligible.

How much of my KiwiSaver Balance can I withdraw to buy a property?

If you fit the eligibility criteria you can withdraw most of your KiwiSaver balance to buy a home, leaving a minimum of $1,000. Your withdrawal can include any funds made up of:

  • Members contributions
  • Employer contributions (voluntary and compulsory)
  • Any returns on investment.
  • Government contributions.

If you’ve got enough to purchase your first home without your KiwiSaver it may be best to save it for your retirement instead (the sooner you start saving for it, the better your retirement will be). 

How can I apply to withdraw my KiwiSaver balance for my first home?

Applying to withdraw your KiwiSaver balance to buy your first home is easy. You’ll simply need to contact your KiwiSaver provider and request to withdraw your funds to buy your first home. They’ll email you a form which you’ll need to fill out and return and your funds should be processed within ten days. 

This can only be done when you’re ready to buy a home and you may need the following documents to apply:

  • A copy of your sale and purchase agreement. 
  • A copy of your ID. 
  • A deposit slip from your lawyer’s trust account. 

Once you’ve applied to withdraw the funds the money will be paid to your lawyer or conveyancer who will pay the vendor on settlement day.

What about the First Home Buyers Grant?

If you’ve been making regular KiwiSaver contributions for at least three years and meet other eligibility criteria you may be able to receive the First Home Grant from the government. 

  • If you buy an existing home you can get $1,000 for each year you’ve paid into the scheme, up to a maximum of $5,000. 
  • If you’re buying a new home or building your own you can get $2,000 for each year you’ve paid into the scheme, up to a maximum of $10,000.

Buying your first home can feel like climbing a mountain, but with a little help from your KiwiSaver account, a government grant, and a team of experts on your side you can make it happen, sooner than you might think. Get in touch with Money Empire for (free) help with every step of the process, from applying for grants and withdrawing your KiwiSaver to securing a home loan and choosing a property. 

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