Lesley Harris our media director, is driven by making a difference to provide first home buyers with one place to find tools, information and advice to assist first home buyers in the property market. She is passionate about giving back to New Zealand and using her voice to pave the way for a more positive future for our children. Lesley had the opportunity to sit down with Martha Williams from Kainga Ora recently and found out more about the new First Home Partner program. This is a fantastic option to help first home buyers into their first homes and well worth finding out more.
Lesley: Who can apply for First Home Partner with Kainga Ora?
Martha: Any NZ citizen over the age of 18 who has a good credit rating and income not over $150K. Those that can get a mortgage with a bank, have at least a 5% deposit which can be made up of savings, KiwiSaver and gifts. You also have to be a first home buyer or there are some cases where people may qualify who have owned a home in the past and now no longer do.
Lesley: How much money will they give me towards my first home?
Martha: Up to $200K per property. How it works is Kainga Ora buy a share of the property up to a maximum of $200k
Lesley: How long will Kainga Ora keep their money in my house?
Martha: 15 years and this can be extended to 20 years on a 'case by case' basis but after 15 years there is a fee of $2250 plus gst.
Lesley: Can I go in with a group of friends or family members?
Martha: Yes absolutely you could do that.
Lesley: What happens if I sell the house?
Martha: If you sell the house then the portion of the property in percentage terms that is owned by Kainga Ora needs to be paid back.
Lesley: So if I make a profit does KO also make a profit?
Martha: Yes Kainga Ora would share in the profit to the percentage level they have invested in the house.
Lesley: What interest or fees do I need to pay Kainga Ora on their investment during the 15 years?
Martha: There is no interest or cost to the FHB until the house is sold.
Lesley: Would I have a say in things like colours landscaping or renovations/improvements?:
Martha: It is your house so of course, you can make it your own, but with any more major renovations sometimes your bank will need to be aware of what you are doing as they have a vested interest in making sure your property holds its value and you can afford the renovations and work.
Lesley: What happens if I lose my job?
Martha: You would need to have discussions with your bank on this as you would if you were not in the Partnership programme.
Lesley: What happens if the First Home Loan scheme gets pulled or withdrawn and no longer offered, would I need to find the money to pay back early?
Martha: No the agreement between yourselves and Kainga Ora is evergreen and Kainga Ora can't request their share back until the 15-year mark or when you sell.
Lesley: Can I buy whatever house I like or are there only certain houses I am limited to?
Martha: You can largely buy what you like but as you can understand your bank and also Kainga Ora would need to be comfortable that the house is a reasonably good investment, and you are not paying too much for it (which I'm sure no first home buyer would want either).
Lesley: How much involvement would I have with KO over the course of the partnership?
Martha: You get a relationship manager who would connect with you each year and review your goals etc. There is also a portal you can log into at any time which estimates the current value of house and value of your share vs Kainga Ora
Lesley: Can I buy more of a share or buy Kainga Ora out completely during the 15 years:
Martha: Yes is possible but only after 3 years. So for example, if after three years the value of the house increased and you had enough equity you could talk to your bank about lending more and you could pay back some or all of Kainga Ora share. If you could raise funds to buy out or reduce Kainga Ora's share you can do so any time after the first 3 years.
Lesley: Is there someone that I can speak to find out more information about this scheme?
Martha: Yes to find out more you can call 0508 935 266
Thanks so much Martha for taking the time to answer these questions, I think this could be a fantastic option for first-home buyers who can afford to buy a house and pay a mortgage but who perhaps are struggling to get the deposit together. Obviously, we would ALWAYS suggest people get independent advice but on the surface, it looks great!
Book A Chat With Our First Home Buyer Adviser.
Do you need assistance with obtaining a mortgage to support First Home Partner? Book a 15-minute chat with our First Home Buyer specialist Dustin.
