Though there are affordable choices for first home buyers such as house and land packages courtesy of new and upcoming estates, some young buyers are still finding it hard to procure their very first house.
The government is now reaching out to young buyers who dreams to own a new first house rather than settling on run downs – provided the conditions set are met. This is where the KiwiSaver Homestart grant comes in effective 1st of April. The KiwiSaver will help ensure that the government will invest twice into helping you own your first house.
Purchasing a land using the KiwiSaver fund means the house must be built into it within a year and the structure must meet the code of compliance.
The head of investment products in Westpac, Nigel Jackson, shares more about KiwiSaver. To be able to qualify for a fund withdrawal, one must be a KiwiSaver member for a minimum of three years, no prior withdrawals and the new home will be the member’s permanent place of residence which means he doesn’t own any other properties.
If you withdraw under first-home buyer category, the fund will be based on your contribution, your employer and earnings from investment if any. The same withdrawal may only be used to purchase the land where you plan to build your first home but it must not be used to procure materials and labors for the house.
The fund will not be released by a KiwiSaver provider unless written agreements such as purchasing and sale is accomplished by the purchaser.
Withdrawal under first-home buyer category is different from the KiwiSaver HomeStart grant. The grant will provide an additional $10,000 for every individual or $20,000 in case of a couple. The grant is offered to citizens with modest income and the said grant will have a little change this coming April.
Effective this April, the KiwiSaver Homestart grant guarantees that the Government will double its support to first home buyers. The grant also covers a vacant lot for residential purposes where the house will be built, house and land packages bought using the plans, and building an apartment using the plans.