Getting into a first home takes careful planning and, for most of us, serious budgeting! These tips for first home buyers will help with planning for the total cost of buying a home, including the mortgage, insurance, legal fees and other costs. Some more help for first home buyers may be available from the government and KiwiSaver, too.

Saving for a deposit on a first home

The first step in saving for a house deposit is to set a savings goal. Most lenders will require a minimum deposit for a home loan of at least 20% of the house price. So if buying a house worth $600,000 you’ll need to save a deposit of at least $120,000. There may be some exceptions, however, such as through the First Home Loan Scheme, which would require a deposit of 5%.

Keep in mind that the bigger your deposit, the less you’ll pay in interest over the long term. Loans that are for more than 80% of a property’s value tend to have higher charges – as there is more risk for the lender. These charges can vary a lot. Some banks charge for lenders mortgage insurance while others increase the interest rate to cover the risk.

Once you’ve worked out how much to save for a house, use this budget planner to work out a budget. It might mean cutting down on non-essentials for a while but the satisfaction of moving into your first home will be worth it!

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Not sure how to calculate mortgage repayments? Use our mortgage tool to see what repayments with different loan settings will be like.

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If there’s a difference between what mortgage repayments would be and what you’re currently paying in rent, it’s a good idea to start putting that amount into regular savings. It will give you (and your lender) an idea of how well your household budget will be able to cope. Use this savings calculator to see how quickly those savings can add up!

Case study: Ondine Grace

Ondine Grace has to pinch herself sometimes when she realises that she has bought her first home in Dunedin when she was just 20. Her friends are astounded.

Read more


Government help

Even with just a 5% deposit, you may be able to borrow enough to buy a first home under the government’s First Home Loan Scheme

If you’re in KiwiSaver and have been contributing to a scheme for at least three years, you may be eligible for a KiwiSaver HomeStart grant. This means that the government could give you up to $5,000 towards an older, existing home, or up to $10,000 towards a newly built home or land to build a new home on. If borrowing with someone else, you can combine those first home buyer grants, which means up to $20,000 if both of you have been contributing to KiwiSaver for five years. There are other eligibility criteria to meet, as well as regional house price caps.

After you've been in KiwiSaver for three years, you may also be able to withdraw almost all of the money in your account to help buy a first home. This is called a KiwiSaver savings withdrawal.

Find out more about First Home Loans, the KiwiSaver deposit subsidy and the KiwiSaver savings withdrawal on the Kāinga Ora website.

Choosing what and where to buy

Your first home may not be your dream home. But it could be an affordable first step on the property ladder.

There’s no point owning your own home if you can’t keep up with the mortgage repayments. Sometimes ‘the worst house in the best street’ is the way to go – particularly if you’re any good at DIY!

Real estate websites are a good place to find out how much properties are worth in different areas.

Want to buy an apartment or townhouse? Check to what degree the bank will lend on these types of properties.

If you're buying a property as an investment, as well as a place to live, it’s important to think about resale or rental potential. Rental property is considered a higher risk by the banks and they may not lend as much as they would for a property you are going to live in.

Consider things like:

  • Is the house close to public transport routes?
  • Are there shops and schools within walking distance?
  • Does the suburb have a strong rental market?

Getting a mortgage on a first home

Your first mortgage, or home loan, will probably be the biggest financial commitment you’ll ever make.

Most of us look at dozens of places before finding the right home to buy. It’s a good idea to be just as careful when choosing a mortgage. Over time, repayments could add up to a lot more than the cost of the home.

There are many types of mortgages, each with its own interest rate, fees and degree of flexibility. All these things affect how much the loan costs and when it will be paid off.

You can shop around for a mortgage yourself, or use the (usually free) services of a qualified mortgage broker.

Guide to getting a mortgage

Lawyers’ fees

Before signing any sale agreement or mortgage paperwork you’ll need to get it looked over by a lawyer. They also handle the ‘conveyancing’ or transfer to you once you buy a house. Fees vary, so shop around.

Find a lawyer and information about the legal issues involved in buying a home on the Property Law website

Builders' reports and LIMs

A builder’s report can identify any possible problems with the house you’re looking at buying. An experienced builder will find things that the untrained eye will miss and may save you thousands.

A Land Information Memorandum (LIM) identifies any issues with the land the house is built on, such as drainage and landslip risks. Order a LIM through the local council, or your lawyer can do it for you.

Moving-in costs

The deposit is just one of the costs you’ll face when you buy your first home.

You’ll need to set money aside for things like:

  • Moving services or truck hire
  • Connection fees for phone, power and Internet
  • Any renovations or decorating you need to do straight away
  • Advertising for flatmates or tenants
  • Legal expenses and builder’s reports

Ongoing costs

Mortgage repayments aren’t the only thing you’ll need to budget for in your new life as a homeowner. Make sure to include insurance, rates and other ongoing costs in the calculations.

House, contents and mortgage insurance

Your home will be your biggest commitment when you have a mortgage and your biggest asset once it is paid off, so you’ll need to protect it from the unexpected.

As well as house and contents insurance, you may need to look at life insurance and mortgage repayment insurance. Remember that Lenders Mortgage Insurance does not cover you, it covers the bank in the event you default on the loan.

Find out more about different types of insurance to consider for a new home.


When you buy your first home you become a ratepayer.

Rates are charges set by local councils to cover the cost of things like roads, water supply, sewerage and parks. They can be up to thousands of dollars a year.

Ask the real estate agent what a property’s rates are before making an offer – so you know if you can afford them. You may also be able to search for a property’s rates on the local council website.

Body corporate fees

If buying an apartment or townhouse that’s part of an accommodation complex and has ‘unit title’, you’ll probably need to pay ‘body corporate’ fees. These cover things like insurance and maintenance of shared areas.

Get a lawyer to go over these details carefully. Is there a fund for major maintenance work in place?

Where to go for help