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Minimum Deposit for First Home Buyers

A key focus of many first home buyers is saving the minimum deposit needed to buy their first home. Many assume this is always 20% however, for first home buyers it can be much less.

When first home buyers start the process the first question asked is:

"How much do I need for the deposit?"

The answer to this however is not as straight forward as it seems. Let's explore some scenarios...

40% Deposit

When purchasing your first home as an investment property - you won’t be living in it / a rental property. The minimum deposit you'll need is 40% of the purchase price.

20% Deposit:

This is the option most commonly talked about as this is a regulation set by the Reserve Bank of New Zealand (RBNZ) when purchasing an existing property to live in. This is the safest option to aim for as although you might only need a 10-15%, having a greater deposit will reduce the mortgage you need to apply for, reducing the repayments. Additionally, having access to additional savings to utilise for potential renovations or unforeseen costs is an advantage.

10% Deposit:

There are a range of situations in which 10% is enough to get you on the property ladder:

  • Purchasing a new build, land & build package or turn-key property that you plan to live in. New builds/construction loans are exempt from the RBNZ regulation stating the minimum 20% deposit.

  • Purchasing property (existing or new build) with a First Home Loan through Kāinga Ora. You will need to satisfy both Kāinga Ora and the Bank facilitating the loan's policy/criteria.

  • Purchasing an existing property and applying to a Bank who’s accepting general <20% deposits for first home buyers - Currently very very limited.

5% Deposit:

You can purchase your first home with as little as a 5% deposit. This is an option only available when purchasing property (existing or new build) with a First Home Loan through Kāinga Ora. You will need to satisfy both Kāinga Ora and the Bank faciltiating the loan's policy/criteria. This will need to be 5% cash savings (Kiwisaver included) as many Banks have this as a minimum in their policy.

The Next Step:

Now that you know there is a wide range of minimum deposit options for first home buyers. The next step is to get in contact with your mortgage adviser and explore which is most suitable for you. This will allow you and your adviser to create a plan specific to you that works towards owning your first home!


To see if you qualify for a First Home Loan with Kāinga Ora visit the link below:

There is also a First Home Grant (Totally seperate from a First Home Loan) you can apply for to add to your deposit funds. To see if you qualify visit the link below:

*This article is are based on current RBNZ & government regulation as of 28th October 2022.


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