If National wins: who suddenly qualifies for a 5% First Home Loan — and what still doesn't change
National pledged to lift First Home Loan income caps to $300,000 if re-elected. Here's what's live today, who might qualify later, and what still won't change for Kiwi FHBs.
National wants to widen who can use a 5% First Home Loan. That sounds like a big unlock for first-home buyers — and for some households it could be. But the pledge is not law yet, and a bigger income cap does not mean a bank will fund you at 5%.
Here's what's live today, what National said on 6 September, who might move into the scheme if they win, and what still won't change.
What's live today
Kāinga Ora's First Home Loan is the current path to a 5% deposit through participating lenders, with Kāinga Ora underwriting. Servicing and credit decisions still sit with the lender.
Income caps today (unchanged):
- $95,000 — single applicant, no dependants
- $150,000 — multiple applicants, or one applicant with dependants
The old First Home Grant is closed. Don't plan as if grant money is coming back.
National has also pointed to scheme activity (their figures, not Stats NZ): more than 7,700 First Home Loan approvals from 1 July 2025 to 30 April 2026, and first-home buyers making up about 29% of purchases in July. Useful colour — not a guarantee you'll get one.
What National pledged on 6 September
On 6 September 2026, National said that if re-elected it would lift the First Home Loan income cap to $300,000 for all applicants. Their policy PDF puts the fiscal cost around $4–6 million and suggests the scheme may roughly double in size.
That needs:
- National winning the election (7 November)
- Implementation after that — not overnight
Until then, the $95k / $150k caps are what lenders and Kāinga Ora still work to. Do not tell a client (or yourself) that the $300k cap is live.
Who might move into eligibility
These are illustrations, not guarantees. Final eligibility depends on the final rules, your household shape, and the lender.
| Household (example) | Today | If $300k "all applicants" lands |
|---|---|---|
| Solo FHB, no dependants, ~$120k income | Likely over the $95k cap | Could become eligible on income alone |
| Couple, combined ~$220k, no dependants | Often over the $150k multi-applicant cap | Could become eligible on income alone |
| Couple already under $150k | May already be in range | Cap change may not move you — deposit, price caps, and servicing still matter |
Income is only one gate. Property price limits, first-home status, participating lenders, and credit checks still apply.
What doesn't change
Even if the income cap rises, you still need to clear the hard bits:
- Servicing — the lender decides what you can repay
- Stress testing — many lenders still test higher than today's specials (often around 7%)
- Credit and LMI / underwriting — a 5% loan is not a guaranteed approval
- Deposit and docs — you still need a real 5% (plus costs) and a clean file
A wider income gate without a stronger serviceability story just moves the "no" from income caps to the bank's credit desk.
Broker checklist (use this with half-ready clients)
Before anyone banks on a future $300k cap:
- Income evidence — payslips / IRD / contracts that match the household story
- Dependants — who counts under today's multi-applicant / dependant rules
- KiwiSaver timing — withdrawal rules still sit beside First Home Loan, not instead of it
- Ready Pack docs — ID, income, bank statements, expenses, debts — so the first meeting is strategy, not archaeology
If National wins and the cap moves, the advisers who already have broker-ready files will move fastest. If it doesn't, those same files still help under today's rules.
Soft market, still FHB-heavy
REINZ's August figures showed a national median around $750,000, softer sales (5,430, about −13% year on year), and more inventory in places. First-home buyers are still one of the more active cohorts — which is why income-cap politics matters — but softer sales don't mean every 5% deal stacks up.
Risk box: thinner equity if prices fall
A 5% deposit means less equity on day one. If prices soften further, you're closer to the edge. Industry coverage has already flagged that equity risk around widening the scheme. Plan for the mortgage you can service — not only the deposit you can scrape together.
Bottom line
- Today: First Home Loan at 5% is real; income caps are still $95k / $150k; Grant is closed.
- If National wins and implements: more households may clear the income gate at $300k.
- Either way: servicing, stress tests, and docs still decide the deal.
Get ready under current rules. Watch the policy. Don't wait on a pledge.
Ready to prepare?
For buyers: Build your number and docs under today's First Home Loan rules — so you're ready if policy moves, and still ready if it doesn't. Start free at MortgageReady.
For brokers: Send clients your branded link before meeting one — affordability, DTI, deposit and opt-in docs in one place. Learn more about MortgageReady for brokers.