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Can I use my KiwiSaver if I've owned a home before?

In recent years, KiwiSaver has become a great way for first home buyers to save for a home, and almost all our first home buyer clients include KiwiSaver as part of their depsoit.

But what about if you've owned a home before? Does that mean you can't withdraw your KiwiSaver?

If you meet a couple of simple criteria, and if you haven't used your KiwiSaver for the first property you bought, then you should be eligible to withdraw it for your "second first home!"

The key is in being "in the same position as a first home buyer". According to Kaingaroa (previously Housing NZ) this means the following (their website description is here);

  • Not previously withdrawing KiwiSaver
  • Being a member of KiwiSaver for more than 3 years
  • Previously owned property, but no longer do
  • You do not have realisable assets totaling more than 20% of the house price cap in your area. This means cash money, shares, investments, boats/caravans, extra vehicles, etc. Anything they think you could sell to realise a deposit, and don't need for day to day living. It doesn't refer to insurance policies or anything non-cash based. 
  • For the Waikato, the house price cap is $500K in Hamilton (so no more than $100K deposit) and in the smaller towns, $400K (so no more than $80K in deposit). 
  • This doesn't mean you need to buy for within the house price cap. That's for the First Home Grant, and you may be eligible for both.

There is one more step you need to do as a previous home owner - and that's obtain Kaingaroa's permission initially to withdraw your Kiwisaver. You need to provide the above info and they'll then send you a letter to give to your provider saying they deem you to be in the same position as a first home buyer. The link to do that is here - you're looking for the 5th option.

Once you have that letter you can apply to your KiwiSaver provider for withdrawal as normal (a simple call to them to confirm your balance and what you can withdraw) and then we'll get a pre-approval for you to buy a home!

I've heard many differing opinions over the years, most of them mixing up the "Previous Home Owner Withdrawal" and the "First Home Loan". A couple of myths are that you have to fit the income caps for the First Home Loan (that's not for KiwiSaver) and that you have to buy within the house price cap in your area (but the rule is that you can't have more than 20% of that price in deposit). I've even had one KiwiSaver advisor tell me that you can withdraw your KiwiSaver a second time - however that one is most definitely unconfirmed!

Wherever you're at in the process, we're here to help. If you're not quite sure where to start, get in touch with us. 

Our First Home Buyer experts are doing this every day and can help guide you through the process easily and quickly so you're taking full advantage of your KiwiSaver funds and buying your first home sooner than you think!

Claire, Adam, Greg & the My Mortgage Team