First home buyers now have another option, through Kāinga Ora, to help them into their first homes.

First Home Partner is a new scheme provided by Kāinga Ora, that can help first home buyers to secure a home, through shared ownership of the property. Kāinga Ora will purchase a percentage share in the property, which is then bought out over time by the home owner.

Who is this scheme for?

This scheme is designed to help first home buyers, whose loan and deposit combined aren’t enough to purchase a home.

You will need at least a 5% deposit.  Kāinga Ora will then provide 25% of the purchase price or $200,000.00 (whichever is the lower) in return for a share of the property. This share in the property is then bought out by the home owner over the following years, eventually leaving the home owner with full ownership of the property.

Who is eligible to use this scheme?

To be eligible for this scheme you must:

  •        Be over 18 years old.
  •        Be a New Zealand citizen, permanent resident or resident visa holder who is ordinarily resident in NZ or be                       applying alongside somebody to whom you are married or in a de facto relationship with, who meets any of                       these requirements.
  •        Have a household income of no more than $130,000 before tax.
  •        Have a good credit rating.
  •        Be a first home buyer.
  •        Have not previously received shared ownership support from Kāinga Ora.
  •        Satisfy the lending criteria of a participating bank; and be buying a home to live in as your primary place of                       residence for at least 3 years after the settlement date.

Shared Ownership Agreement

As the property will be partly owned by Kāinga Ora, you will be required to enter into a Shared Ownership Agreement which will include some additional obligations including:

  •        To make improvements or renovations to the property you will need to seek permission from Kāinga Ora.
  •        Meeting annually with a Kāinga Ora relationship manager to review the financial plan in place to successfully buy            out their share in the property.
  •        To do your best to purchase their share in the property in your first 15 years of ownership, and not later than after 25         years of ownership.

If you are considering entering into this scheme it would pay to seek advice from a professional to understand the implications.