The first home buyers package

John Key has announced a package of changes to help first home buyers get their first house. The key changes are:

  • Price caps for the KiwiSaver First Home Deposit Subsidy increases from $400,000 to $485,000 in Auckland, $300,000 to $400,000 in Christchurch, and some other increases
  • The income cap for a couple to access the KFHDS increases from $100,000 to $120,000

The Government expects the number of first home buyers receiving the subsidy will go from 4,700 to 10,000 a year and the number of Welcome Home Loans from 845 to 2,500 – so a doubling and trebling respectively.

The total cost of the package is $64 million over four years.

There is a table showing for each area what the price cap is as a percentage of the mean sale price. Major areas are:

  • Auckland 76%
  • Wellington 76%
  • Christchurch 94%
  • Tauranga 86%
  • Hamilton 92%

They seem pretty fair to me. First time buyers generally will not be buying a house at the mean or average. That’s what you move into years later when you sell your first home and upgrade.

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