Kainga Ora's First Home Partner Scheme

Looking to make that leap into homeownership, but your deposit and home loan aren't quite reaching the finish line? The First Home Partner programme may be able to help future buyers.

Although funding is currently on hold and applications are not being accepted as of November 2023, this scheme has been so effective that it is certainly worth keeping an eye on! Watch this space, and get in touch with us to register your interest.

Introduced in 2021 by Kainga Ora – Homes and Communities, the First Home Partner Scheme is significant for being a turning point in the nation’s housing and urban development environment. This shared ownership option with Kainga Ora could be the key to unlocking your ideal house if you’re hoping to buy your first property. Let’s get started and investigate how this special initiative, once it is in the financial position to accept applications again, can close the gap and set you up for reasonably-priced homeownership.

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Kainga Ora – Homes and Communities

The term “Kainga Ora” signifies well-being through places and communities. Kainga Ora is a significant player in New Zealand’s housing sector, providing tenancy services to nearly 200,000 customers while owning and maintaining nearly 69,000 public houses.

Kainga Ora has supplied around 7,000 homes in the last four and a half years, the majority of which are newly built properties. The estimated value of their assets is $40 billion. Kainga Ora has big dreams for the future: during the next ten to fifteen years, they want to build up to 40,000 market, inexpensive, and public homes.

There are a number of difficulties with simply building new homes, and Kainga Ora have identified a way to empower people to purchase their own homes amidst steeply-rising inflation.

The First Home Partner Scheme

The Kainga Ora First Home Partner concept is based on “shared ownership.” Through this approach, prospective homeowners can co-own a property with Kainga Ora, who serves as a financial partner on their homeownership journey.

A Shared Ownership Arrangement

Kainga Ora contributes a share of the home’s purchase price, and in return, they own a share in the property. The exact number depends on a number of variables, such as your deposit, the amount of credit provided by a participating bank, and Kainga Ora’s contribution.

This arrangement allows you to enter the property market with a more accessible deposit and financial support from Kainga Ora. In turn, as the primary occupant and owner of the majority of the property, you have all the rights and obligations associated with being a homeowner, just like everyone else.

With the flexibility that the shared ownership arrangement provides, prospective homeowners can overcome the obstacles of large down payments and strict loan criteria. The maximum contribution made by Kainga Ora is set at 25%, or $200,000, contingent upon individual circumstances.

Understanding the Shared Ownership Experience

Daily living won’t feel all that different for people starting joint ownership compared with ‘complete’ homeownership, since you would own the majority of the property. However, there are a few important points to note about the process:

  • In order to be eligible for the First Home Partner programme, you must fulfil certain requirements set forth by Kainga Ora.
  • A written Shared Ownership Agreement specifies your and Kainga Ora’s respective roles, responsibilities, and rights that govern the shared ownership.
  • For a minimum of three years following the settlement date, you must make the shared property your principal place of residence.
  • A Kainga Ora Relationship Manager will meet with you annually as part of the review process to evaluate your household’s financial situation and discuss how to become a fully owned homeowner.
  • The ultimate goal is to buy Kainga Ora’s portion of the house in the first fifteen years of ownership, and on the 25th year from the settlement date, full ownership will be reached.
  • If you want to sell your house, undertake renovations or make substantial changes to the property, Kainga Ora’s approval is crucial.

Kainga Ora is committed to supporting shared homeowners on their journey to complete homeownership as soon as they are financially able. To assist in this endeavour, they offer a Goals Management Programme, involving annual meetings with a Kainga Ora Relationship Manager. The programme’s goal is to help you achieve full homeownership within the first 15 years, maintain the home’s condition, and ensure you continue living in the property during the shared ownership period.

Shared ownership offers a viable way for people and families to get into the real estate market with a smaller down payment than might be expected. With Kainga Ora’s First Home Partner programme, many New Zealanders can now more easily achieve their goal of owning a home by offering a crucial first step towards complete homeownership.

If you have any questions regarding mortgage alternatives, home deposits, or advice on how to climb the real estate ladder, or if you’re ready to take the next step towards becoming a homeowner, please don’t hesitate to contact the knowledgeable staff at Rapson Loans & Finance.