How can you use your KiwiSaver cash to buy your first home?

 

So you’ve decided you want to buy your first home, and your KiwiSaver account balance is going to be part of your deposit.

How can you withdraw this money, and what are the most common questions around accessing it?

Senior Product Manager Iain Duncan, of Housing New Zealand, which administers the withdrawals as well as the KiwiSaver HomeStart grant, answers JUNO’s questions.

Am I eligible to withdraw my KiwiSaver funds?

You might be eligible if: 

·         You’ve been a member of a KiwiSaver scheme or complying superannuation fund for at least three years

·         You haven’t made a withdrawal previously to help buy a home

·         You don’t currently own any interest in real estate,

·         You’re buying your first home

What do I need to do?

Contact your KiwiSaver provider first. They can talk you through the process, advise how much you can withdraw and how long it takes for an application to be processed. Each provider has their own application form and timeframes, so make sure you’re aware what those are.

Are there any reasons why I wouldn’t qualify to withdraw?

 ·         If you haven’t been a member for at least three years, you won’t qualify – there’s no discretion around this.

·         If you currently own an interest in real estate, like a section, or other property, you won’t qualify.

·         If you’ve withdrawn KiwiSaver savings previously to help with a house purchase you wouldn’t qualify – this is a one-time opportunity and there is no ‘second chance’ option to do so a second time.

·         If you’re selling and buying property at the same time, to move up the property ladder.

·         If you own investment property, but wanting to buy your own home.

·         If you purchase of a half-share of property that you currently have an interest in (such as a property subject to a marital split).

·         If the property is being purchased by a family trust, not a person.

·         If you’re a previous home-owner, but have a significant amount of realisable assets, which results in you not being ruled as being in the same financial position as a first-home buyer.

Can I buy an investment property with my KiwiSaver account savings?

The property must be intended to be the main place of residence for the member or them and their family members, so no, it can’t be used to buy an investment property.

I’ve owned a home before. Does this now mean I can’t withdraw my KiwiSaver account cash?

No. Provided you haven’t withdrawn your funds previously to help buy a home, if you have owned property in the past, but no longer own any interest in estate, you can potentially qualify to withdraw your funds, if Housing New Zealand deems you to be in the same financial position as a first-home buyer. Make an initial application to Housing New Zealand, which will assess your financial position.

If you do meet the criteria, a letter will be issued that you need to take to your KiwiSaver scheme provider to support your application. For more info and where you can apply online, go to www.kiwisaver-homestart.co.nz.

This is only required for those who have owned property previously and who no longer own any interest in property. There’s no stand-down period to meet; it’s purely a case of no longer owning any interest in property, and then meeting the Housing NZ criteria as a previous home-owner.

First published 4 May, 2018

JUNO does not contain financial advice as defined by the Financial Advisers Act 2008. Consult a suitably qualified financial adviser before making investment decisions. This story reflects the views of the contributor only. Content comes from sources that JUNO considers accurate, but we do not guarantee that the content is accurate. Charts are visually indicative only.


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