Kainga Ora First Home Loan Guide 2026
If you are a first home buyer in New Zealand and you do not have a 20% deposit, the Kainga Ora First Home Loan could be the pathway that gets you into your own home. This guide explains how it works, who qualifies, and what you need to know before you apply.
What Is the Kainga Ora First Home Loan?
Kainga Ora is a New Zealand government agency that helps people get onto the property ladder. The First Home Loan is their main programme for buyers who have less than a 20% deposit.
With a First Home Loan, you may only need a 5% deposit. The loan is offered through participating banks — currently Kiwibank and Westpac. Kainga Ora underwrites the risk, which means the bank is willing to lend at a higher loan-to-value ratio than they normally would.
Who Can Apply?
To qualify for a Kainga Ora First Home Loan, you need to meet several criteria. You must be a New Zealand citizen or permanent resident who is ordinarily resident in New Zealand. You need to be buying your first home, or be a second-chance buyer in a similar financial position to a first home buyer.
There are income caps. If you are buying on your own without dependants, your income must be under $95,000 per year. If you have dependants or are buying with someone else, the combined income cap is $150,000.
You must have been employed with your current employer for at least three months. The property must be a standard residential home that you will live in — it cannot be an investment property.
How Much Deposit Do I Need?
The minimum deposit is 5% of the purchase price, and it cannot be borrowed. Your deposit can come from your own savings, a KiwiSaver first home withdrawal, or a non-repayable gift from a family member.
For example, if you are buying a home for $600,000, you would need at least $30,000 as your deposit. Many of our Pacific clients use a combination of KiwiSaver and personal savings to reach this amount.
What About the LMI Fee?
Because you are borrowing more than 80% of the property value, there is a Lenders Mortgage Insurance fee. As of July 2025, this fee is 1.2% of the loan amount, and it gets added to your loan so you do not need to pay it upfront.
On a $570,000 loan, that works out to about $6,840 added to your total borrowing. Your mortgage adviser will explain exactly how this affects your repayments.
Are There Limits on What I Can Buy?
Yes. The property must be a standard residential home. There are also realisable asset caps that vary by region, which your mortgage adviser can check for your specific area. The home must be owner-occupied — you need to live in it.
How Does Kainga Ora Differ From a Normal Home Loan?
The main difference is the deposit requirement. A standard home loan from most banks requires at least a 10% deposit for owner-occupied homes, and you would also pay a low equity margin on top of your interest rate. With the First Home Loan, you can get in with 5% and the low equity margin does not apply.
The First Home Loan is also exempt from the Reserve Bank's LVR speed limits and DTI restrictions, which means you may be able to borrow more than under normal bank rules.
Which Banks Offer the First Home Loan?
Currently, Kiwibank and Westpac are the two participating lenders. Each bank applies the Kainga Ora criteria but may also have their own additional requirements. For example, Westpac excludes bonus income from serviceability calculations for First Home Loan applicants.
As a mortgage adviser, we work with both banks and can tell you which one gives you the best outcome based on your specific situation.
What Steps Should I Take?
First, check if you meet the income caps and eligibility criteria above. Second, check your KiwiSaver balance — if you have been contributing for at least three years, you can withdraw most of it for your first home deposit.
Third, get in touch with a mortgage adviser. We can run your numbers through both Kiwibank and Westpac to see what you qualify for, and guide you through the entire application process at no cost to you. The bank pays our fee.
Talk to NiuLIFE Home Loans
At NiuLIFE Home Loans, we specialise in helping Pacific and Maori families navigate the home loan process. The Kainga Ora First Home Loan has helped many of our clients get into their first home, and we would love to help you too.
Book a free First Step Call with us today and let us work out what is possible for your situation.