WORKING WITH KIWISAVER
Firstly, you may be able to withdraw the total amount in your KiwiSaver account less $1,000 and any amount transferred from an Australian complying superannuation fund. The money you withdraw must be put towards your first home. You need to apply early as the money you withdraw must be paid directly to your New Zealand solicitor (or licensed conveyancer) before settlement. You may be able to make a first home withdrawal to make deposit payments. There are some circumstances, such as buying at auction, where this may not be possible. Talk to your New Zealand solicitor or licensed conveyancer for more information.
Are you eligiable?
You can make a KiwiSaver first home withdrawal if one of the following applies:
– you’ve been a member of a KiwiSaver scheme and/or a complying superannuation fund for a combined total of at least three years
– Inland Revenue received a contribution to a KiwiSaver scheme for you at least three years ago
You will also need to meet all of the following requirements:
– You intend to live mostly in the home you’re buying
– You’ve never before owned your own property (except for a few limited circumstances)
– You’ve never before made a withdrawal to buy a first home
– The home you are buying is in New Zealand. During your KiwiSaver membership, if you have been living overseas and did not have a permanent residence in New Zealand over that time, you will not be entitled to withdraw any Government annual contributions received during that same period.
Scheme for First
HomeStart works by allowing eligible first home buyers (or second chance buyers) to withdraw all of their KiwiSaver contributions including their individual contributions, their employer contributions and the government tax credits (50 cents for every dollar up to $541.43 annually) to be used towards the deposit of a home purchase.
Under the HomeStart programme eligible individuals or couples may also receive a grant of up to $20,000 to build a new home.
The value of the grant is determined by the length of time purchasers have been a member of KiwiSaver and whether they are acting as individuals or couples.
The amount of the grant depends on whether the home is existing or newly built.
YOU COULD GET:
– $1,000 a year for each year you’ve been a KiwiSaver member, up to a maximum of $5,000, if your first home will be an existing home, or
– $2,000 a year for each year you’ve been a KiwiSaver member, up to a maximum of $10,000, if your first home will be newly built.
The Government pays this directly to your solicitor on settlement day – it does not come out of your KiwiSaver account.
Some criteria apply, including limits on your income and the value of the house you intend to buy. See the Housing New Zealand website for more information.
– The cap on the purchase price of a house is $550k i.e. purchase price of home and land cannot exceed $550k (Christchurch/Selwyn)
– There is an income cap (unchanged from previous scheme) of $85k for an individual or $130k for a couple purchasing a home.
– You must have contributed to KiwiSaver for a minimum of three years and must not have previously received a KiwiSaver Grant.
SECOND CHANCE BUYERS
People who have owned a home before may still be eligible to receive support however there are three key criteria:
- Must have income less than the income cap.
- Must have assets worth less than 20% of the house purchase price
- Cannot have previously received a KiwiSaver Grant or subsidy.
CONDITIONS FOR NEW BUILDS
– Land must be purchased as a vacant residential section.
– The new house must be built within 12 months of the land purchase being settled.
– When purchasing a house and land package off the plan, a new house must be built within 12 months of the date on which the first home buyer entered into an agreement to purchase the house and land package.
Why not book a free consultation now with one of our team to find out how to reduce the cost of your home as well as how to avoid many of the mistakes that people make right at the start!
To arrange a quick meeting, just complete the form below, or give us a call now at (03) 379 0222