How to Withdraw KiwiSaver for First Home Buyers

KiwiSaver is a voluntary savings scheme in New Zealand that is designed to help individuals save for their retirement. If you have been contributing to KiwiSaver for at least three years you may be eligible to withdraw your your KiwiSaver savings to put towards your first home if you are a first-time home buyer.

Can I withdraw my kiwisaver for my first home deposit?

Yes you can, if you are a first-time home buyer you may be eligible to withdraw some of your KiwiSaver savings to put towards a deposit on your first home. You can withdraw your entire KiwiSaver balance including any Government and employer matched contributions that you may have received however, you must leave a minimum of $1,000 in your account. You also must intend on living in the property you are purchasing, so it cannot be an investment property.

How to withdraw your kiwisaver for your first home deposit?

If you are deemed eligible to withdraw your KiwiSaver for your first home deposit, then you need to contact either your KiwiSaver provider or adviser to obtain a ‘First home entitlement’ letter. This letter will prove your eligibility to withdraw funds and state the amount can withdraw from your KiwiSaver.

 HOW LONG DOES THE KIWISAVER WITHDRAWAL TAKE FOR FIRST HOME PURCHASE?

Once you have successfully completed your application to withdraw money from your KiwiSaver scheme, your funds should be released into your bank account within 10 to 15 working days. Please contact either your KiwiSaver provider or KiwiSaver adviser if the funds do not show in your account after 15 working days..

CAN I WITHDRAW MY KIWISAVER TO PURCHASE LAND?

You can withdraw your KiwiSaver balance to buy land as long as you intend on living on that land at some point. You must apply for the KiwiSaver first home withdrawal prior to buying the land. There is no time frame for when you must build a house on that land.

ARE THERE ANY FEES ASSOCIATED WITH WITHDRAWING YOUR KIWISAVER FOR FIRST HOME PURCHASE?

No, there are no fees association with withdrawing your KiwiSaver fund to purchase your first home. This is a complimentary service from your KiwiSaver provider and adviser.

CAN I GET THE KIWISAVER FIRST HOME GRANT?

On 22 May 2024, at the direction of the Government, Kāinga Ora stopped accepting new applications for the First Home Grant.

CAN I USE MY KIWISAVER FOR A DEPOSIT IF I AM A PREVIOUS HOMEOWNER?

If you have previously owned a home but no longer own a property, you may be eligible to withdraw your KiwiSaver funds. Kāinga Ora will initially need to determine whether you are a qualifying person and if you are deemed to be in the same financial position as a first home buyer, a letter produced by Kāinga Ora will be forwarded to your KiwiSaver scheme provider, to assist with your application to withdraw your KiwiSaver contributions. Kāinga Ora is only involved in the savings withdrawal if you have previously owned a home or land.

See below for current criteria available also on the Kāinga Ora website :

• You have not previously withdrawn your KiwiSaver funds to buy a home

• You have been a member of KiwiSaver for at least three years

• You have previously owned property, but no longer own any interest/share in property (this does not include ownership of Māori land)

• You do not have realisable assets totalling more than 20% of the house price cap for an existing/older property in the area that you are looking to buy in.

WHICH KIWISAVER IS BEST FOR PURCHASING A FIRST HOME?

If you are looking at purchasing a first home within the next 2 years, it is highly recommended that you consider a fund of either conservative or cash nature. This will reduce your exposure to growth assets and therefore adverse market swings. You should always select a KiwiSaver scheme provider based on your investment horizon, risk tolerance and product preferences. With that being said, having an adviser on your KiwiSaver is the best way to ensure that you both receive your first home entitlement letter in a timely manner, and are in a fund that suits your investment time frame, risk tolerance and preferences.

Please get in contact if you want to speak to us in regards to the best KiwiSaver provider and fund for your personal situation. It is important to consider the various options available and seek advice from a financial adviser before making any decisions. Please complete our KiwiSaver Discovery Quiz and we can provide you with a free KiwiSaver report and recommendation.

Compound Wealth are based in Mount Maunganui, Tauranga and offer KiwiSaver, Investment & Retirement Financial Advice to clients all over New Zealand.