Kāinga Ora First Home Loan: Who Qualifies and How It Changes Your Deposit
Income caps, price caps, and first-home status — how the government-backed First Home Loan can unlock a 5% deposit path for eligible NZ buyers.
The First Home Loan (administered with Kāinga Ora and participating lenders) can allow eligible buyers to purchase with as little as 5% deposit, where ordinary bank LVR rules would otherwise push you toward a much higher threshold. It is not automatic — caps and criteria apply.
Typical eligibility themes (verify current rules)
- First-home buyer status (or equivalent eligibility as defined by the scheme)
- Income caps — historically different for one buyer vs two or more; always check the official table
- Regional property price caps — your purchase price must fall under the cap for your area
- Intent to live in the property
- Lender credit assessment still applies — scheme access is not a bypass of serviceability
Numbers change. Use official Kāinga Ora / Homes and Communities resources and your mortgage adviser for the live thresholds.
How it interacts with LVR and low-equity margins
Without the scheme, borrowing with a small deposit often triggers a low-equity margin or simply hits bank allocation limits for high-LVR lending. The First Home Loan structure exists specifically to support a slice of eligible lending — but you still need to demonstrate you can afford repayments at the stress-test rate and fit within DTI settings.
First Home Loan vs First Home Grant
The grant is cash assistance toward your deposit for eligible KiwiSaver members who meet contribution and property tests. The loan is about lender insurance / high-LVR access. You might hear both in the same conversation — they solve different problems. See our glossary and deposit checklist for how pieces stack.
Model your position in MortgageReady
When you enter your household details, MortgageReady checks your numbers against the style of rules used for First Home Loan eligibility (income and price caps) and surfaces whether a 5% deposit path might apply — alongside your affordability score and borrowing scenarios.
Build your free profile, read more on deposit gap and equity in the Mortgage Glossary, and take a free PDF summary to your adviser to confirm scheme eligibility with current published caps.