Good news for those that have previously owned property.
The Minister for Building and Housing, Dr Nick Smith, has recently announced that the income caps are being removed from the previous home owner eligibility criteria from 1 July 2016
Currently the income caps are $120,000.00 for a couple and $80,000.00 for an individual.
The removal of the income caps will mean that previous homeowners who have low assets will be able to access their KiwiSaver funds to buy a home regardless of how high their income is.
You will still need to meet Housing New Zealand's criteria, which is as follows:
- you must be resident in New Zealand;
- you have not received a first home KiwiSaver withdrawal before;
- you have been contributing to KiwiSaver for at least three years;
- you have previously owned a home but at the time of your application you no longer have an interest in a property; and
- your realisable assets are less than 20% of the house price cap for the area you are buying in (e.g. the current house price cap in Christchurch is $450,000.00 so your realisable assets must be under $90,000.00).
If you meet the above criteria you will be able to apply to Housing New Zealand after 1 July 2016 for a Letter of Determination to submit to your KiwiSaver provider to show that you are eligible for the second chance withdrawal. Please note that an application for a Letter of Determination can take up to four weeks to process.
Previous home owners may also qualify for the HomeStart grant, however there are further eligibility criteria required to obtain this grant, e.g. having at least a 10% deposit and complying with the house price caps for the area you are buying in, amongst other criteria.
* Please note, income thresholds and house price caps are current as at the date of this article.
For further information on buying and selling property, including first home buyer support, please see the Wynn Williams Private Client website page