Frequently Asked Questions

You're considered a first home buyer if you: • Have never owned a home before in New Zealand or overseas • Haven't received the First Home Grant or its predecessors previously • Plan to live in the home as your primary residence • Are a New Zealand citizen or permanent resident If you've previously owned a home but your financial situation has changed significantly, you may still qualify for some programs. Contact us to discuss your specific situation.

The deposit you need depends on several factors: **Minimum Deposits:** • 5% - Available through First Home Loan and some banks (with LMI) • 10% - More accessible, may still require LMI • 20% - Avoids Lenders Mortgage Insurance, gets better rates **For a $600,000 home:** • 5% deposit = $30,000 • 10% deposit = $60,000 • 20% deposit = $120,000 Don't forget you may be eligible for the First Home Grant (up to $10,000) and can use your KiwiSaver savings!

DTI (Debt-to-Income) is a ratio that compares your total debt to your gross annual income. In 2026, the limit is 6.0x your income. **Example:** If your household earns $100,000/year: • Maximum borrowing = $100,000 × 6 = $600,000 • Plus your deposit = Total purchase price **What counts as debt:** • Mortgage payments • Car loans • Personal loans • Credit card minimums • Student loans To improve your DTI: pay down existing debt, increase your income, or look at lower-priced properties.

It's never too early to start preparing! Here's a general timeline: **12+ months before:** • Start saving aggressively • Check your credit score • Pay down existing debt • Research suburbs and prices **6-12 months before:** • Get pre-approval • Engage a mortgage advisor • Attend open homes • Understand the buying process **3-6 months before:** • Serious house hunting • Building inspection knowledge • Lawyer engagement • Finalize finance **Remember:** The market changes, so staying informed is key. Use our tools to track your progress!

Your borrowing power depends on: **Income Factors:** • Gross annual income (salary, bonuses, commissions) • Partner's income • Rental income (if applicable) • Investment income **The 2026 DTI Rule:** Banks can lend up to 6.0x your gross annual income. **Example Calculation:** • Income: $80,000/year • Maximum debt: $80,000 × 6 = $480,000 • With $50,000 deposit • Maximum purchase price: ~$530,000 Use our Borrowing Power Calculator for a personalized estimate based on your specific situation.

Both options have pros and cons: **Fixed Rate (1-5 years):** ✅ Predictable payments ✅ Protection from rate rises ✅ Often lower initial rates ❌ Break fees if you sell/refinance early ❌ Miss out if rates drop **Floating Rate:** ✅ Flexibility to make extra payments ✅ No break fees ✅ Benefit if rates drop ❌ Payments can increase ❌ Usually higher than fixed **Popular Strategy:** Many first home buyers split their loan: • 70-80% fixed (certainty) • 20-30% floating (flexibility) Current rates (2026): 4.59% - 4.90% for 1-2 year fixed terms.

Yes! KiwiSaver is a great way to boost your deposit: **Eligibility:** • Been in KiwiSaver for at least 3 years • First home buyer (or in same financial position) • Buying in New Zealand • Plan to live in the home **What you can withdraw:** • Your contributions • Employer contributions • Government contributions • Investment returns **What stays:** • $1,000 kick-start (if received) • $521 annual member tax credit **Example:** If you've contributed 4% of a $70,000 salary for 5 years: • Your contributions: ~$14,000 • Employer (3%): ~$10,500 • Govt contributions: ~$2,600 • **Total available: ~$27,000** Contact your KiwiSaver provider to start the withdrawal process.

The First Home Grant (formerly HomeStart Grant) provides up to $10,000 towards your deposit: **Grant Amounts:** • Existing home: $1,000 per year of KiwiSaver contribution (max $5,000) • New build: $2,000 per year of KiwiSaver contribution (max $10,000) **Eligibility Requirements:** • Income under $95,000 (single) or $150,000 (couple) • Minimum 5% deposit • First home buyer • House price caps apply (varies by region) • Lived in NZ for 12+ months **Regional Price Caps (2026):** • Auckland: $875,000 (existing) / $925,000 (new) • Wellington: $750,000 / $850,000 • Christchurch: $550,000 / $700,000 • Rest of NZ: varies Apply through Kainga Ora.

LMI protects the lender if you default on your loan. It's typically required if your deposit is less than 20%. **When LMI applies:** • Deposit less than 20% • Some lenders allow 10% with LMI • First Home Loan allows 5% with government backing **Cost:** • Usually 1-3% of loan amount • Added to your loan (you pay interest on it) • One-time premium **Example:** • Home price: $600,000 • Deposit: $60,000 (10%) • Loan: $540,000 • LMI: ~$8,000-$16,000 **Ways to avoid LMI:** • Save 20% deposit • Use First Home Loan (government-backed) • Have a guarantor (family member) • Some professions get LMI waived (doctors, lawyers, etc.)

Pre-approval (conditional approval) is when a lender approves you for a loan amount before you find a property. **Benefits:** ✅ Know your exact budget ✅ Stronger negotiating position ✅ Faster settlement ✅ Confidence at auctions ✅ Sellers take you seriously **What you need:** • Proof of income (payslips, contract) • Bank statements (3-6 months) • ID • Evidence of deposit • Details of existing debts **How long it lasts:** • Usually 3-6 months • Can be extended if needed • May need updating if circumstances change **Recommendation:** Yes, get pre-approved! It makes the whole process smoother and shows you're serious.

Understanding the different sale methods: **Auction:** • Public bidding process • Property sells to highest bidder • Usually unconditional (no cooling off) • 10% deposit on the day • Set date creates urgency **Private Treaty:** • Make an offer through agent • Can include conditions (finance, inspection) • Negotiation possible • Cooling-off period may apply • More time to consider **Tender:** • Submit sealed bid by deadline • No negotiation • Vendor chooses best offer **As a first home buyer:** • Private treaty is often less stressful • Auctions require pre-approval and confidence • Get advice from your lawyer before bidding

Building inspections are crucial - don't skip them! **Building Inspection:** • Cost: $500-$800 • Identifies structural issues • Checks for leaks, moisture • Assesses overall condition • Essential for peace of mind **LIM Report (Land Information Memorandum):** • Cost: $300-$400 • Council records for the property • Building consents, permits • Zoning information • Natural hazard info **Additional Reports:** • Meth testing (if concerned) • Electrical inspection (older homes) • Plumbing inspection • Cross-lease check (if applicable) **When to get them:** • Before auction (unconditional) • As a condition of sale (private treaty) • Always budget for these costs

Budget for these additional costs: **Upfront Costs:** • Legal fees: $1,500-$2,500 • Building inspection: $500-$800 • LIM report: $300-$400 • Valuation: $600-$800 (if required) • Moving costs: $500-$2,000 **Ongoing Costs:** • Rates: $2,000-$5,000/year • Insurance: $1,000-$2,000/year • Maintenance: 1-2% of home value/year • Body corporate (apartments): $3,000-$8,000/year **At Settlement:** • Registration fees • Adjustments for rates • Insurance setup **Total to Budget:** Allow $5,000-$10,000 on top of your deposit for these costs.

Timeline from start to finish: **Preparation Phase:** • Saving deposit: 2-5 years typically • Research: 3-6 months • Getting pre-approved: 1-2 weeks **Active Buying:** • House hunting: 1-6 months • Making an offer: Immediate to weeks • Conditional period: 2-4 weeks • Settlement: 4-6 weeks after going unconditional **Typical Total:** • Cash buyer: 4-8 weeks from offer • With mortgage: 6-10 weeks from offer • From starting to look: 3-9 months **Auction Timeline:** • Bid and win: Day 1 • 10% deposit: Day 1 • Settlement: 30-60 days later **Tips:** • Get pre-approved early • Have your lawyer ready • Be prepared to move quickly in hot markets

Great suburbs for first home buyers vary by region and budget: **Auckland (under $800k):** • Manurewa - Good transport, affordable • Papakura - Growing area, new developments • Henderson - West Auckland hub • New Lynn - Transport links improving **Wellington (under $700k):** • Johnsonville - Good schools, transport • Karori - Family-friendly • Newtown - Vibrant community **Christchurch (under $550k):** • Many options across the city • Riccarton - Central, good amenities • Wigram - New developments **What to look for:** • Transport links • School zones • Growth potential • Amenities and shops • Community feel Use our Suburb Guides to compare median prices, growth rates, and lifestyle factors.

Both have advantages depending on your situation: **Apartments:** ✅ More affordable entry point ✅ Lower maintenance ✅ Often central locations ✅ Good lock-and-leave option ❌ Body corporate fees ❌ Less space ❌ Potential leasehold issues ❌ Harder to add value **Houses:** ✅ More space and privacy ✅ Land appreciates ✅ Can renovate/extend ✅ No body corporate ❌ Higher purchase price ❌ More maintenance ❌ Further from CBD (usually) **Consider:** • Your lifestyle needs • Future plans (family?) • Budget constraints • Investment potential **First Home Buyer Tip:** Apartments can be a great way to get on the ladder, then upgrade later.

Understanding property growth: **Historical Averages:** • Long-term NZ average: 5-7% per year • Recent years: More volatile • Some areas: 10%+ growth • Others: Flat or declining **What drives growth:** • Infrastructure projects • New developments • School zones • Transport improvements • Employment opportunities **2026 Market:** • Auckland: 2-4% growth • Wellington: 1-3% growth • Christchurch: 3-5% growth • Regional areas: Varies **Warning Signs:** • Declining population • High crime rates • Poor transport • Few amenities **Remember:** Past performance doesn't guarantee future results. Buy for lifestyle first, investment second.

Yes, you absolutely need a property lawyer or conveyancer! **What they do:** • Review sale and purchase agreements • Check title and property records • Handle settlement • Register the mortgage • Ensure compliance • Protect your interests **Cost:** • $1,500-$2,500 for standard purchase • More for complex transactions • Worth every penny for peace of mind **When to engage:** • Before making an offer • Definitely before auction • Early in the process **Finding one:** • Ask for recommendations • Check reviews • Ensure they specialize in property • Get a quote upfront **DIY is not recommended** - property law is complex and mistakes are costly.

FMA (Financial Markets Authority) regulations protect consumers: **Our Status:** First Home Buyers Guide operates under FMCA Section 389 as a referrer only. We are not registered financial advisers. **What this means:** • We provide information, not advice • We refer you to qualified professionals • We disclose all commissions • You should seek independent advice **Our Disclosures:** • We receive commissions from partners • Commissions range $200-$500 per referral • All commissions disclosed before referral • You pay nothing extra **Your Protection:** • All referred advisers are FMA compliant • You can choose any adviser • No obligation to proceed • Independent advice always recommended **Questions?** Contact us or read our full disclosure statement.

Essential insurance for homeowners: **Must-Have:** **House Insurance:** • Covers rebuilding if destroyed • Required by all lenders • Cost: $1,000-$2,000/year • Get quotes from multiple providers **Highly Recommended:** **Contents Insurance:** • Covers your belongings • Often bundled with house insurance • Cost: $500-$1,000/year **Life Insurance:** • Pays off mortgage if you die • Protects your family • Cost varies by age/health **Income Protection:** • Covers mortgage if you can't work • Important for single earners • Cost: 1-3% of income **Shop Around:** • Compare multiple providers • Check excess amounts • Understand what's excluded • Review annually