In October the OCR was reduced to 2.5%, and within days a string of New Zealand banks trimmed one‑year and two‑year fixed rates to around the mid 4% range which put first homes back within reach for many Aucklanders.
Against that backdrop, KiwiSaver remains one of the most powerful tools for getting your deposit together. This guide, written for our clients and readers explains exactly how to use KiwiSaver for your first home. What you can withdraw, who’s eligible, how the process works, and how the mortgage broker makes it smoother.
KiwiSaver basics for first‑home buyers
If you’ve been in KiwiSaver for at least three years, you may be able to withdraw the bulk of your balance to buy your first home. Specifically, you can usually withdraw your contributions, your employer’s contributions, the government contributions, and investment returns, but you must leave at least $1,000 in your account.
Note: Funds you transferred from an Australian complying super scheme can’t be withdrawn for a first home. The home must be in New Zealand and intended to be your principal place of residence.
Can I use KiwiSaver for the deposit before my agreement goes unconditional?
Yes. Since a 2015 law change, KiwiSaver first‑home withdrawals can be used for payments before your purchase becomes unconditional (for example, a deposit on a conditional agreement). Your solicitor holds the funds in trust and returns them if the deal doesn’t proceed.
Who’s eligible to use KiwiSaver for home deposit?
First‑home buyers
You will need to meet the three‑year membership rule and intend to live in the property as your main home. To have your Kiwisaver funds released, you need to get prepared as it’s not a simple bank transfer – you need a signed agreement, a witnessed statutory declaration, and your lawyer to send in the paperwork for the funds to be released. Work with your solicitor to complete the application once the sales & purchase agreement is unconditional and get your solicitor to submit the application. Remember, it may take anywhere between 10 – 15 days to process so plan accordingly for settlement dates.
Previous homeowners (“second‑chance” buyers)
If you’ve owned property before, here or overseas you may still qualify if Kainga Ora determines you’re in a similar financial position to a first‑home buyer. If you wanna learn more about the rules and process we have previously compiled a guide on KiwiSaver for Previous Homeowners – you can find here.
How we make the process smoother
Buying your first home is a huge step, but the process of using your KiwiSaver funds can be confusing. Many people assume it’s as simple as an instant bank transfer, but it’s not. Understanding the timeline and the paperwork is essential to a smooth, non stressful purchase experience.
Your Step-by-Step Guide
To ensure a smooth process and protect your purchase, follow these steps.
Step 1: Talk to us early. We will map out your borrowing capacity, likely interest‑rate terms, and how much of your KiwiSaver you can safely rely on for the deposit and settlement. With lower rates flowing through the system since October, we can show you how repayments look at today’s pricing and under sensible “what‑if” scenarios.
Step 2: Get a pre‑approval. A lender’s pre‑approval frames your price range and strengthens your negotiation position. Auckland vendors are active again as rates fall, so arriving pre-approved matters.
To get your pre-approval going, sort out your deposit. The cleanest way to handle your deposit is to pay the initial amount from your personal savings. This secures your deal while you’re waiting for the KiwiSaver funds to be released.
Step 3: Line up your KiwiSaver withdrawal – as mentioned before it may take anywhere between 10 – 15 days to process your application and for the funds to be released so take that timing into account for settlement dates. To use your KiwiSaver for the deposit, your lawyer must include special legal wording in the agreement. This ensures the funds will be held in a trust account until they are officially cleared. A common clause might state that the “balance of the 10% deposit will be paid within one working day of the Purchaser’s KiwiSaver funds clearing into the Purchaser’s solicitor’s trust account.”
Step 4: If you need the deposit before the contract is unconditional, your KiwiSaver money can be released to a stakeholder and can be held securely until conditions are met, or returned if not. We brief your agent and the vendor’s solicitor so everyone’s aligned.
Step 5: Settlement. Remaining KiwiSaver funds are paid from your solicitor’s trust account directly to the vendor as part of the purchase price on settlement day.
Why timing right now favours first‑home buyers
A lot of factors are favouring first home buyers currently. Rates are trending down. The Reserve Bank has lowered the OCR to 2.5% and signalled further easing if inflation continues to moderate. Banks have already cut a raft of fixed terms, with one‑year “specials” dropping to around 4.49% at major lenders in October. Lower rates improve serviceability and can lift the size of the home you can afford.
Low‑deposit lending is still available. Current LVR “speed limits” allows up to 20% of new owner‑occupier loans with less than 20% deposit, which is helpful if your KiwiSaver plus savings can make up to 10% or more. If not, then, buying with just a 5% deposit is available and a good time to leverage. The First Home Loan (formerly Welcome Home Loan) lets eligible first‑home buyers get into the market with as little as 5% down, often using KiwiSaver plus savings or a gift. To qualify, your before‑tax income over the last 12 months needs to be:
- $95,000 or less for an individual buyer without dependants
- $150,000 or less for an individual buyer with one or more dependants
- $150,000 or less (combined) for two or more buyers, regardless of the number of dependants
Things to note: Standard bank servicing, Debt to Income ratio and lending criteria still apply. For details and next steps, see our guide to the First Home Loan – 5% deposit.
FAQs about KiwiSaver for a First‑Home Deposit
How much can I withdraw from KiwiSaver for my first home?
In most cases you can withdraw the entire amount minus $1,000 that needs to remain in your account.
Can I use KiwiSaver for the deposit while the contract is still conditional?
Yes. Since 2015, funds can be used for payments before the agreement is unconditional, provided they’re held by a stakeholder and returned if the deal falls over. Your solicitor manages this so best you check this with your solicitor.
Can I buy land to build on with Kiwisaver funds?
Yes – if the land is in New Zealand and you intend to build and live there as your principal residence.
I’ve owned a home before – can I still use KiwiSaver?
Possibly. Kāinga Ora may confirm you’re in the same financial position as a first‑home buyer (no current property and limited realisable assets). If approved, they’ll issue a letter for your provider. Also, it’s worth noting, you can only draw from kiwi saver once so if you have withdrawn Kiwisaver funds for a previous purchase you won’t qualify.
Can my partner and I both use our KiwiSaver?
Often yes, each eligible buyer can apply through their own provider. We will confirm with your providers and structure your purchase accordingly.
How long does it take to get the money?
Most providers ask for around 10 working days from receiving a complete pack. Kāinga Ora decisions for previous homeowners also indicate about 10 working days.
Are there any government grants I can stack with KiwiSaver?
The First Home Grant was discontinued in May 2024. KiwiSaver withdrawals and First Home Loans remain pathways we can explore with you.
Will rates keep falling?
No one can promise the exact path, but the OCR has been moving down and banks have been cutting fixed rates and it’s somewhat expected that interest rates should keep going down. We’ll price your plan using today’s rates and add buffers so you’re comfortable if things change.
Your next step: make your KiwiSaver work harder
Getting into your first home in Auckland is a moving puzzle that includes interest rates, KiwiSaver timing, valuations, and more. Our job at Oliver Broomfield is to coordinate all of it. We match you with the right lender, manage the KiwiSaver and solicitor timing, and negotiate sharper rates and cash‑backs where possible.
Book a free, no‑obligation chat and let’s map your first‑home plan, deposit strategy, KiwiSaver withdrawal, and a lending path that fits your budget now and in the future. Let Oliver Broomfield Mortgage & Insurances do the legwork so you can focus on choosing the right home.