Colin Ambler/cvnznews.com
The National‑led Government is preparing to widen access to low‑deposit home loans, announcing a major lift to income caps for its First Home Loan scheme — a move it says will help more young New Zealanders break into an increasingly difficult housing market.
Housing spokesperson Chris Bishop says first‑home buyers have surged under the current Government, making up 29 per cent of all purchases in July, the highest monthly share in more than two decades. But despite that momentum, the biggest barrier remains unchanged: scraping together a 20 per cent deposit while paying rent, childcare, and rising living costs.
National’s plan is to extend the scheme’s income cap to $300,000, allowing far more households to qualify for loans requiring only a 5 per cent deposit. The scheme, run through Kāinga Ora and participating lenders, has already supported more than 33,000 households since 2003, including 7,700 approvals in the past ten months alone.
Bishop argues the current caps — unchanged since 2022 — are locking out exactly the kinds of people the scheme was designed for. A single buyer must earn under $95,000 to qualify, while couples or single parents must earn under $150,000.
“That means a junior doctor on $100,000 can’t access the scheme,” Bishop says. “Neither can a young couple earning a combined $163,000, or two new police graduates earning $77,000 each.”
With the average first‑home buyer income now sitting around $146,000, Bishop says the caps are out of step with reality. “Plenty of young couples earn more than $150,000 but still struggle to save a 20 per cent deposit. National’s changes will address those pressures.”
The announcement sits within National’s broader push to lift home ownership back toward historic highs of 74 per cent, up from today’s 66 per cent. Bishop says decades of planning red tape throttled housing supply, but recent reforms have begun to reverse that trend.
The policy is also being bundled with National’s wider “Backing First Home Buyers” package, which includes commitments to no new taxes, boosting KiwiSaver, extending paid parental leave, capping council rates, and lowering student loan repayment rates.
Bishop says the message is simple: “National is sending a clear signal to ambitious young Kiwis that we back them to stay in New Zealand and get into a home of their own.”
