First Home Deposit Guide: Your Fast Track to Home Ownership in NZ
Looking at house prices and trying to figure out the deposit? Let's cut through the noise and get straight to what you need to know.
The standard deposit banks ask for is 20% of the property's value. Sounds steep, right? For a $600,000 house, you’re looking at a $120,000 deposit…
However, if you choose to look at purchasing a new build, you only need to have a 10% deposit. So now for that $600,000 house, you only would need $60,000. Now it is looking a lot more achievable, right?
Need to get into your first home but don’t want to wait forever to save 20%? You’re in luck—there are fast tracks available.
Some banks offer 10% deposit options for first-time buyers, as long as you tick the right boxes. You’ll need a solid income and a clean credit history. Yes, you may pay a bit more in interest, and Lenders Mortgage Insurance (LMI) will be a factor, but it could be worth it if it gets you into your own home sooner.
Here’s the real win: new builds. If you’re open to a brand-new home, you might only need a 5% deposit. Banks love lending for new builds because they’re often higher quality and come with warranties. Plus, the government is keen to see more homes built, so they’ve made it easier to borrow for new builds.
Think about it: waiting to save 20% while house prices climb? Sometimes acting faster with a smaller deposit can get you ahead in the long run.
Your KiwiSaver is a secret weapon in your deposit arsenal. If you've been contributing for at least three years, you can pull out almost everything you've saved (keeping just $1,000 in there). That's your contributions, your employer's contributions, and all those investment returns, ready to power up your deposit.
Banks love proof—it's how they know you’re ready. You’ll need to show where your deposit’s coming from, and yes, they’ll ask for bank statements. Think of it like a financial CV. You're showing them you’ve got what it takes to handle a mortgage.
For your deposit, make sure you have:
The deposit game changes depending on where you play. In Auckland, you're looking at bigger numbers—around $70,000 to $100,000 for a standard deposit on a new build. But head to the regions, and the deposit requirements can drop.
Smart players check the price caps for different areas. What might get you an apartment in Auckland could secure a house with a garden in other parts of New Zealand. It’s not about settling—it’s about being strategic.
Let’s make a plan for your deposit. First, do the math: add up your savings, KiwiSaver, and any other support you might qualify for. That’s your starting point.
Next, get pre-approval. Chat to different banks—each one has its own lending style. Some may offer better rates, while others might be more flexible with deposits. You’re not just looking for a yes—you want the best yes.
Once you know your numbers, house hunting becomes focused. You’ll know what price range to aim for, whether new builds are the way to go, and which areas make the most sense for your budget.
What's the smallest deposit I can get away with in NZ?
The short answer? 5% for a new build, if you play your cards right. The longer answer? Most first home buyers succeed with 10-20%, depending on the property and their financial situation. Think of deposit options like gym memberships - there's a standard package (20%), a mid-range option (10%), and a special deal for new builds (5%).
Can I use my KiwiSaver as a deposit?
Absolutely! After three years of contributing, your KiwiSaver becomes your deposit-boosting superhero. You can withdraw almost everything, just leaving $1,000 in there. It's like having a savings account that's been working out at the gym for you.
Do banks in NZ have different deposit requirements?
They sure do. Banks are like coffee shops - they all serve home loans, but each has its own special blend of requirements. Some might want a bigger deposit but offer better rates. Others might be cool with a smaller deposit if your income's solid.
How long will it take to save a deposit?
On average, Kiwis take 4-8 years to save a 20% deposit. But here's the thing - we're not about average at Aera. We focus on getting you into a new build with a 10% deposit rather than waiting many more years to save a 20% deposit for an older home. With our home savings accelerator and bonus interest rates, we can help you crush that timeline.
Your first home isn't just waiting - it's getting more expensive while you wait. Here's your power play:
Take our First Home Readiness Quiz to see exactly where you stand and how we can fast-track your journey. We're not just another company with a calculator - we're your shortcut to smashing those deposit goals.
Ready to turn your first home dreams into a street address? Let's get your deposit sorted faster.
This guide's intel is current as of November 2024. Property prices, lending criteria, and government programmes can change quicker than Auckland weather. For the latest updates and personalised advice, have a chat with our team.
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