First-home buyers are drawing increasing amounts of money from their KiwiSaver accounts to help them get on the property ladder.

Figures from ANZ bank - the country's largest KiwiSaver provider - show the average amount drawn out by its members in the year to September was $20,000, which was double the average in 2012, and it continues to rise.

For the eight months to May 31 the average rose to $22,339, with more than 7300 people using their KiwiSaver money to get into their first home.

Craig Mulholland, ANZ Wealth's managing director, said growing balances meant people had more money to tap into for buying their first home.

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"We expect withdrawals to increase in size as KiwiSaver balances increase."

Just over 40 per cent of first-home buyers used KiwiSaver as a deposit last year, according to the bank.

Some experts have questioned the wiseness of allowing people to take all of their money out of KiwiSaver to buy a home, leaving people starting from scratch to save for retirement in their 30s or 40s.

Mulholland said the uniqueness of KiwiSaver was that the money could be drawn out for a first home.

He believed the ability to take the money out for a home was an incentive for young people to begin contributing when they start out in the workforce.

"The more important question is not should they use it for a first home but recommencing paying into it for retirement after."

Mulholland said while everyone's situation was different and it often felt difficult to keep saving after taking on a mortgage, those who stopped contributing to KiwiSaver faced missing out on compounding returns and the government's annual contribution.

"Withdrawing money for a first home can put a big dent in the amount you will have when you retire. So it is important that you resume contributions as soon as possible and consider increasing your contribution rate to ensure you catch up and achieve your retirement savings goal," he said.

"This will ensure that saving for a comfortable retirement and owning your own home work hand in hand."

Just over 40 per cent of first-home buyers used KiwiSaver as a deposit last year, according to ANZ bank. Photo / Getty Images
Just over 40 per cent of first-home buyers used KiwiSaver as a deposit last year, according to ANZ bank. Photo / Getty Images

So far it appears most home-buyers are continuing to contribute.

ANZ figures show just 2 per cent opted to put contributions on hold after taking money out for a home, although the data may not show a full picture because it does not take into account people who shift providers.

One couple who have used KiwiSaver to recently get on the property ladder is Craig and Kylee Knox from Te Awamutu.

Kylee Knox said putting the house deposit together was made easier by her husband having money in KiwiSaver.

It was getting on top of the couple's debt which was harder.

"We were that much in debt and it felt like we were drowning," Craig Knox said.

They applied for a debt consolidation loan but were turned down because the debt was too big.

That was three years ago. But after getting budgeting help the couple were able to get on top of their debt and this year finally moved into their own home.

Jane Rush, a branch manager at the ANZ in Cambridge who helped the couple said it saw lots of people in similar situations.

But she said being in KiwiSaver was a really easy way to save for a first home.

"You don't know that you are saving money. It automatically comes out of your income and you don't miss it."