This is the government backed loan that lets eligible first home buyers in New Zealand buy with a 5% deposit. It is underwritten by Kāinga Ora, which is what allows selected banks to lend where they otherwise could not. Here is who qualifies, what it costs, and how to apply.
Most people rule themselves out before they check, usually over the income caps. The rules are more generous than they look, and a short conversation will settle it. Worth checking before you assume:
Four conditions decide it. Meet all four and a participating bank can lend you up to 95% of the purchase price.
You need to have earned $95,000 or less in the 12 months before you apply as a single buyer, or $150,000 or less if you are buying with someone else or you have dependants. That figure is your total income before tax.
You need to be a New Zealand citizen, a permanent resident, or hold a resident visa and be ordinarily resident here. There is no minimum time you must have been in the country, though individual lenders apply their own rules.
It has to be a home you will live in as your main residence. There is no limit on what the property can cost, which surprises people. The price caps were removed in June 2022 and have not come back.
Normally this is for people who have not owned property before. If you have owned a home and your financial position is now similar to a first home buyer, you can still be assessed as eligible.
The interest rate is the bank’s normal rate, not a special one. The cost that is specific to this loan is an insurance premium of 1.2% of the amount you borrow.
On a $500,000 loan the premium is $6,000. You can pay it upfront or spread it across the life of the loan. It rose from 0.5% to 1.2% on 1 July 2025, when the government stopped covering the other 0.7% of it.
A First Home Loan does not carry a low equity margin. Borrow above 80% without this scheme and most banks add an extra margin to your interest rate until you reach 20% equity, which over several years usually costs more than the premium does.
Most buyers are limited to around six times their gross household income. Lending under the First Home Loan is exempt from that limit, which for someone on a modest income can be the difference between a no and a yes.
Your approval lasts 90 days. If you have not found a home by then it can be renewed, though the premium that applies is the one in force at the time.
The application goes through a participating bank rather than through Kāinga Ora directly. Not every bank offers it, which is the first place people get stuck.
Income, residency, deposit and history. This takes one conversation and it is worth doing before you get attached to a property.
Only selected lenders offer the First Home Loan, and they do not all treat the same application the same way. I place yours where it has the best chance.
I prepare the application and the supporting documents, and take it to the bank on your behalf.
The bank sends it to Kāinga Ora for underwriting. Once approved, you have 90 days to find a property.
You make an offer knowing your finance is conditionally in place. I check the conditions with you before anything is signed.
The premium is added to your loan or paid upfront, the loan draws down, and the house is yours.
If a bank has already turned you down for a First Home Loan, that is not the end of it. Lenders apply the same scheme differently, and it is worth a second look.
Every lender treats low deposits differently, and those rules change. I put your application where it has the best chance rather than wherever is quickest.
Paperwork, lender questions, conditions coming back. I handle the back and forth so you can get on with your life.
The lender pays me once your loan settles. That is the same whether you are buying with 5% or with 20%.
I work with first home buyers in Tauranga, Mount Maunganui, Pāpāmoa and across the Bay of Plenty, and with plenty of people who live nowhere near me. Most of this happens by phone, email and video call, so where you are does not change the advice or how easy it is to reach me. If you are local and would rather sit down together, that is easy to arrange.
The things people ask me most about the Kāinga Ora First Home Loan.
It is a government backed home loan that lets eligible first home buyers in New Zealand purchase with a deposit of 5% instead of the usual 20%. Kāinga Ora underwrites the loan, which is what allows participating banks to lend at that level. You apply through a bank, not through Kāinga Ora.
You need to have earned $95,000 or less in the 12 months before you apply as a single buyer, or $150,000 or less if you are buying with someone else or you have dependants. That is your total income before tax.
No. The property price caps were removed in June 2022. What matters now is whether you meet the eligibility criteria and whether the bank thinks you can service the loan.
It is 1.2% of the amount you borrow. On a $500,000 loan that is $6,000, and you can pay it upfront or spread it across the life of the loan. It went up from 0.5% on 1 July 2025, when the government stopped contributing towards it.
Only selected lenders take part, and the list changes. Westpac, SBS Bank and The Co-operative Bank have been among them. Because not every bank offers it, and those that do assess applications differently, it pays to apply through the right one.
Yes. Most people fund the 5% deposit from their KiwiSaver first home withdrawal. The two work together, and for many first home buyers that combination is what makes the purchase possible.
Possibly. The loan is designed for first home buyers, but if you have owned a home and your financial position is now similar to someone buying their first, you can be assessed as eligible. It is worth asking rather than assuming.
Ninety days. If you have not found a property in that time the application can be renewed, though the insurance premium that applies will be the one in force when you renew.
Nothing. My service is free to you, because the lender pays me once your loan settles. If that ever would not be the case, I would tell you before we started.
