Get Sorted: A HomeStart advantage

As of this week, the amount of your KiwiSaver savings you can withdraw to buy a first home is increasing. Photo / Thinkstock

New changes in the way you can use KiwiSaver to buy a first home make it easier to step onto the property ladder.

With the NZ Super weekly rate for individuals rising to $375 on Wednesday, a question comes to mind: how can anyone pay rent with that amount and still have anything left over for living expenses?

NZ Super seems to do a good job of keeping people out of hardship - if you don't have high housing costs. And KiwiSaver can help you get on the property ladder sooner and pay off a mortgage well before retirement.

As of this week, the amount of your KiwiSaver savings you can withdraw to buy a first home is increasing. Now even what we call "the big five hundy" - the $521 you can get from the government each year - can be used. So you can take out all but the $1,000 kick-start that you get when you join.

Also new this week is the KiwiSaver HomeStart grant, which means that, depending how long you've contributed to KiwiSaver, the government will give you:

• Up to $5,000 towards an older, existing house
• Up to $10,000 towards a new house or towards buying land on which a new house will be built

Taking into account housing prices these days, you can use the HomeStart grant for houses that cost up to the following amounts in these areas:

• $550,000: Auckland
• $450,000: Hamilton City, Tauranga City, Western Bay of Plenty District, Kapiti Coast District, Porirua City, Upper Hutt City, Hutt City, Wellington City, Nelson City, Tasman District, Waimakariri District, Christchurch City, Selwyn District, Queenstown Lakes District
• $350,000: the rest of the country

As always, there are conditions, so for the details try hnzc.co.nz, email kiwisaver.enquiries@hnzc.co.nz or call 0508 935 266.

The new KiwiSaver first-home withdrawal amounts and HomeStart grants can give you a boost if you're buying a first home - it's worth looking into to use them to your advantage.

Get Sorted is written by Sorted's resident blogger, Tom Hartmann. Check out the guides and calculators at Sorted - brought to you by the Commission for Financial Capability - at sorted.org.nz.