First Home buyers can claim a First Home Grant from the Government to assist with the payment of their deposit on their first home purchase. In the recent budget the Government announced that the cap on a First Home Grant will lift to new limits specific to each region. They are now as follows:
- Tauranga: the cap will be $800,000 for an existing property and $875,000 for a new build.
- Auckland region: the cap will be $875,000 for an existing property and for new build properties.
- Queenstown-Lakes: the cap will lift to $875,000 for existing properties and $925,000 for new builds.
- Wellington: the cap rises to $750,000 for existing properties and $925,000 for new builds.
- Christchurch: the cap rises to $550,000 for existing properties and $750,000 for new builds.
- Hamilton: the cap rises to $650,000 for existing properties and $725,000 for new builds.
- For the rest of the country, the cap for a grant to purchase existing property ranges from $400,000 to $875,000, and for new builds the new range is $500,000 to $925,000.
The Government will also remove house price caps entirely from First Home Loans. This is to provide a better choice of homes for first home buyers and will mean the First Home buyers are not limited to buy in a particular price range. The income caps and lender requirements are to ensure that the First Home Loan is used by buyers who need support for the purpose of a first home.
The house price caps and income caps will be reviewed every six months.
The Kainga Whenua Loan cap will also be lifted, from $200,000 to $500,000. This is for people building, relocating or buying a home on whenua Māori.
The First Home Grant changes take effect on 19 May 2022, while the Kainga Whenua Loan and First Home Loan changes will take effect on 1 June 2022.
By Sam Messenger – Registered Legal Executive
The information contained in this article should not be construed as legal advice on any subject matter.
