KiwiSaver & First Home Loan: Your 2026 Guide to Government Help

Let's be straight with you - things have changed a bit in the last couple of years when it comes to government support for first home buyers. One big scheme has gone, but there's still meaningful help available, and a lot of people don't realise how much they've already got sitting there waiting for them.

Here's a plain-English breakdown of what's on offer in 2026.

The First Home Grant Is Gone — Here's What Replaced It

If you've done any googling recently, you might have come across the First Home Grant - a government scheme that gave eligible buyers up to $10,000 towards their deposit. Unfortunately, that scheme was discontinued in May 2024.

The good news? The two tools that arguably matter more are still very much alive.

1. Your KiwiSaver: Probably Worth More Than You Think

If you've been contributing to KiwiSaver for at least three years, you can withdraw almost all of it to put towards your first home. We're talking your own contributions, your employer's contributions, the government's member tax credit, all of it (minus a $1,000 minimum balance you have to leave in).

For a lot of first home buyers, this is the biggest chunk of their deposit. It's your money, you've already earned it. This scheme hasn't changed, and there's no cap on how much you can withdraw.

One thing worth knowing for 2026: From 1 April this year, the default KiwiSaver contribution rate went up from 3% to 3.5% (for both you and your employer). If you're not yet at the point of buying but you're saving towards it, this increase means your KiwiSaver balance is growing a little faster. A step up to 4% is also planned for 2028.

If you're not sure what you've got in your KiwiSaver or whether you'd qualify to withdraw it, give us a shout, it's one of the first things we look at when we sit down with a first home buyer.

2. First Home Loan: Buy with Just a 5% Deposit

The standard rule with most banks is a 20% deposit. For a $600,000 home, that's $120,000. That's a lot of saving.

The First Home Loan, backed by Kainga Ora, changes that. It lets eligible buyers purchase with as little as a 5% deposit - so on that same $600,000 home, you'd need $30,000 instead of $120,000. That's a very different conversation.

To qualify, you generally need to:

• Be a first home buyer (or be in a similar financial position to one)
• Meet income caps set by Kainga Ora
• Be buying a home to live in (not an investment property)
• Have a solid credit history

Not every bank offers it, and the eligibility criteria can feel a bit detailed but that's exactly the kind of thing we help you navigate. We know which lenders are most receptive and how to put your application in the best possible light.

Fixed or Floating? What to Do With Your Mortgage

Once you've sorted your deposit and your pre-approval, you'll need to decide how to structure your mortgage. This is a question we get a lot.

Right now, the average one-year fixed rate sits around 5.00%, while floating rates are around 5.72%. Most of our clients end up splitting their mortgage, fixing the majority for certainty on repayments, while keeping a portion floating so they can make extra payments or stay flexible.

There's no one-size-fits-all answer here. It depends on your income, your plans, and how you feel about a bit of uncertainty. That's a conversation worth having with a mortgage adviser who actually knows your situation.

Where to From Here?

The honest truth is that the best thing you can do right now is find out exactly where you stand. What's in your KiwiSaver. What deposit you need. Whether you'd qualify for a First Home Loan. What you can borrow.

None of that costs anything to find out and knowing it changes everything.

We're Brent and Becs, and we do this every day. We love helping first home buyers figure out what's possible, especially when they come in thinking it's out of reach and leave realising it's not.

Let's have a chat.

Book a Chat with Brent or Becs →

Mortgage Mates are based in Rangiora, North Canterbury, and work with first home buyers all across New Zealand. Give us a bell anytime.

This post is general in nature and doesn't constitute personalised financial advice. Please get in touch with us directly for advice tailored to your situation.

‍