Before you can purchase a house, or even attempt to get a home loan you need a deposit saved up. But how much of a deposit do you need? The average deposit size is 20% of the house purchase price - more is even better and will help in the long run. If you have less than 20%, don’t worry, there is still the option of getting a home loan with a 10% deposit on a case-by-case basis.

But wait there's more! From October 2019, to get a First Home Loan you only need a 5% deposit which means getting into your first home is that much easier. 

A deposit can be made up of a variety of sources;

The good news is there are a variety of sources available to you to create the deposit, it doesn’t just have to come from your current account.

  1. Withdrawal from your KiwiSaver (you’re allowed to withdraw from your Kiwisaver if you’ve been contributing for 3 continuous years or more).
  2. First Home Grant - You’re eligible for this is you’re a first home buyer and meet other criteria set out by Housing New Zealand, read more about this criteria here. 
  3. Money gifted by family or a friend from savings or from using equity on their home.
  4. Money from the sale of your previous property.

Why is a bigger deposit best?

The more money you have for your deposit the better in the long run. Firstly, it makes it easier to get a loan as it’ll show lenders/banks that you have a great savings history, and the ability to service the loan. It also means you’re paying less back, as you had to borrow less then if you had a lower deposit.

So a bigger deposit means less to pay off, less interest to pay and less time to pay it off. 

Want help to arrange your deposit?

Talk to us, we’ll make sure you are making the most of the options available to you.