Government loans aimed at helping New Zealanders buy their own homes are proving popular, Catherine Gaffaney reports in the second part of our five-week investigation into getting a foothold on the property ladder. And a loosening of restrictions is making it even easier.

Hawke's Bay first-home buyers have borrowed more than $140 million through the Welcome Home Loan scheme since it began.

Housing New Zealand figures show 736 first-home buyers in Hawke's Bay were granted a total of $142,963,000 in loans since the scheme launched in 2003. The average loan was $194,243.

As of May 31, more than $14 million had been lent to 73 local first-home buyers this financial year.

Welcome Home Loan is a scheme run by Housing New Zealand to help first-home buyers secure loans. Prospective buyers can borrow up to 90 per cent of a property's value. Selected banks and credit unions loan the money.

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To qualify for the 10 per cent deposit loan, borrowers have to have earned less than $80,000 in the previous 12 months as an individual, or $120,000 as a couple.

Borrowers must intend to live in the property rather than buying it as an investment.

Financial Advice Hawke's Bay co-director Paul Sewell said the loans were an excellent way for home buyers to get into the market.

"They're a powerful tool to assist those who might not be able to otherwise buy their first home," he said. "They also help those who are to buy a home to get into the market earlier."

KiwiSaver also fed well into the scheme, he said.

"Cashing in on KiwiSaver can be a great way to make the 10 per cent deposit.

"If a Hawke's Bay couple on $50,000 each contribute to KiwiSaver for five years, they could potentially have $15,000 to $20,000 each to contribute to a deposit."

Welcome Home Loan's house price cap in Hawke's Bay is $350,000.

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Price caps vary for each region, with the highest of $550,000 in Auckland. The rest of the country is capped at between $350,000 and $450,000.

iLender chief executive Jeff Royle was more sceptical about the loans. He considered them "fairly restrictive".

"Welcome Home Loans only work for some people," he said. "In this day and age, a lot of people are pressured into making quick lending decisions so they don't have the time to come up with the mortgage offer using a Welcome Home Loan.

"They're almost not a thing in Auckland because there's not many places in Auckland under $550,000. Properties under $550,000 are mostly apartments, but the scheme doesn't lend 90 per cent for apartments so they can be pretty difficult to rely on."

Home buyers should weigh up the scheme with other options, Royle said.

"We always give people advice on three options that could work for them and then recommend the one we think would be the best fit.

"The good part of Welcome Home Loans is the deposit doesn't have to be genuine savings. Mum and Dad can gift you the full 10 per cent -- other lenders won't do that.

"Other products have other advantages. The ANZ First Home Package, for example, is a lot faster to get because you're only dealing with one company, where the Welcome Home Loan has to be approved by the lender and then by Housing New Zealand."

Roost mortgage broker Paul Richardson also said the loans weren't one-size-fits-all.

"It's positive that they can help people get around the Reserve Bank's [loan-to-value ratio] restrictions but, like anything the Government does, there's rules and restrictions," he said.

"The price caps may have gone up but it's still proving hard for a lot of people to get into their first home."

Nationwide, more than $2.4 billion has been lent to more than 12,000 first-home buyers.

As of May 31, more than $220 million had been lent to 965 buyers this financial year.