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First Home Buyers

First Home Buyers

Buying your first home takes careful planning and, for most people, serious budgeting! Our tips for first home buyers will help you plan for the total cost of buying a home, including your mortgage, insurance, legal fees and other costs. Some help may be available from the Government and KiwiSaver, too.

Saving for your deposit

The first step in saving for your deposit is to set yourself a savings goal. Most lenders will require a deposit of at least 20% of the amount you are borrowing. So if you’re buying a house worth $400,000 you’ll need to save a deposit of at least $80,000. There may be some exceptions, however, such as through the Welcome Home Loan Scheme, which would require a deposit of 10%.

Keep in mind that the bigger your deposit, the less you’ll pay in interest over the long term. Loans that are for more than 80% of a property’s value tend to be have higher charges – as there is more risk for your lender. These charges can vary a lot. Some banks charge for lenders mortgage insurance while others increase the interest rate to cover the risk.

Once you’ve worked out how much you need to save, use our money planner to work out a budget. You may need to cut down on non-essentials for a while but the satisfaction of moving into your first home will be worth it.

If there is a difference between what your mortgage repayments would be and what you are currently paying in rent, try adding that amount to your regular savings. It will give you (and your lender) an idea of how well your household budget will be able to cope. Use our savings calculator to see how quickly your savings can add up.

Government help

With a 10% deposit, you may be able to borrow enough to buy a house under the government’s Welcome Home Loan Scheme

If you’re a KiwiSaver member and have been contributing to a scheme for at least three years, you may be eligible for a KiwiSaver HomeStart grant. This means that the government could give you up to $5,000 towards an older, existing home, or up to $10,000 towards a newly built home or land to build a new home on. If you're borrowing with someone else, you can combine your grants, which means you could have up to $20,000 if you were both contributing to KiwiSaver for five years. There are other eligibility criteria to meet, as well as regional house price caps.

You may also be able to withdraw almost all of the money in your KiwiSaver account to help buy your first home. This is called a KiwiSaver savings withdrawal.

Find out more about the KiwiSaver deposit subsidy and the KiwiSaver savings withdrawal on the Housing New Zealand website.

Choosing what and where to buy

Your first home may not be your dream home. But it could be an affordable first step on the ‘property ladder’.

There’s no point owning your own home if you can’t keep up with the mortgage repayments. Sometimes ‘the worst house in the best street’ is the way to go – particularly if you are good at DIY!

Real estate websites are a good place to find out how much properties are worth in different areas.

If you want to buy an apartment or townhouse, check your bank will lend on these types of properties - not all will.

If you’re buying a property as an investment, as well as a place to live, it’s important to think about resale or rental potential. Rental property is considered a higher risk by the banks and they may not lend as much as they would for a property you are going to live in.

Consider things like:

  • Is the house close to public transport routes?
  • Are there shops and schools within walking distance?
  • Does the suburb have a strong rental market?

Getting a mortgage

Your first mortgage, or home loan, will probably be the biggest financial commitment you’ll ever make.

You’ll probably look at dozens of places before you find the home you want to buy. It’s a good idea to be just as careful when choosing your mortgage. Over time, your repayments could add up to a lot more than the cost of the home.

There are many types of mortgages, each with its own interest rate, fees and degree of flexibility.  All these things affect how much the loan costs you and when it will be paid off.

You can shop around for a mortgage yourself, or use the (usually free) services of a qualified mortgage broker.

Find out more in our guide to getting a mortgage

Lawyers fees

Before signing any sale agreement or mortgage paperwork you’ll need to get it looked over by a lawyer.  You will also need a lawyer to handle the ‘conveyancing’ once you buy your house.  Fees vary so shop around.

You can find a lawyer and information about the legal issues involved in buying a home on the Property Law website

Builders' reports and LIMs

A builder’s report can identify any possible problems with the house you’re looking at buying. An experienced builder will find things that the untrained eye will miss, and may save you thousands.

A Land Information Memorandum (LIM ) identifies any issues with the land the house is built on. It will identify issues like drainage and landslip risks. You can order a LIM through your local council, or your lawyer will do it for you.

Moving-in costs

The deposit is just one of the costs you will face when you buy your home.

Use our event planner calculator to list each item you will need to pay for and add up the total you will need to have on hand.

You will need to keep money aside for things like:

  • Moving services - or truck hire if you’re doing it yourself.
  • Connection fees for phone, power and internet.
  • Any renovations or decorating you need to do straight away.
  • Advertising for flatmates or tenants.
  • Legal expenses and builder’s reports

Ongoing costs

Your mortgage repayments aren’t the only thing you’ll need to budget for in your new life as a homeowner.  Make sure you include insurance, rates and other ongoing costs in your calculations.

House, contents and mortgage insurance

Your home will be your biggest asset so you will need to protect it from the unexpected.

As well as house and contents insurance, you may need to look at life insurance and mortgage repayment insurance. Remember that Lenders Mortgage Insurance does not cover you, it covers the bank in the event you default on the loan.

Find out more about different types of insurance you will need to consider for your new home.


When you buy your first home you become a ratepayer.

Rates are charges set by local councils to cover the cost of things like roading, water supply, sewerage and parks. They can be up to thousands of dollars a year.

Ask the real estate agent what a property’s rates are before you make an offer – so you know if you can afford them.  You may also be able to search for a property’s rates on the local council website.

Body corporate fees

If you’re buying an apartment or townhouse that’s part of an accommodation complex and has ‘unit title’, you’ll probably need to pay ‘body corporate’ fees. These cover things like insurance and maintenance of shared areas.

Get your lawyer to go over these details carefully.  Is there a fund for major maintenance work in place?

Where to go for help