Helping Kiwis get into property

LAST week I wrote about the opportunities that lie outside of the metro areas for home ownership. I also waxed lyrical against the grizzle that comes from Aucklanders, particularly around housing prices when there are other options.

New Zealanders value home ownership because it brings security to individuals and their families. With that security, families move less often, kids stay in the same schools and learn better, the strength in neighbourhoods enhances lives and the fabric of society is stronger as the threads in that fabric get stronger.

Fixing the problems is not about one portfolio, though.

That's why the Government has a wide-ranging programme aimed at improving housing supply and affordability. We are taking steps to cut unnecessary compliance costs - cutting red tape and insisting that consenting is faster, less costly and the process is fit for purpose.

Investment in skills will raise the productivity performance of the building sector, and the Government is keeping firm control of its own overall spending, so assisting in holding mortgage interest rates at their lowest levels in half a century.

All these measures will pay growing dividends over time.

We've doubled the level of financial support available for first-home buyers through the KiwiSaver HomeStart scheme and data on the first year of the programme shows that the scheme helped 11,943 people into their first home with grants valued at $55.6 million.

And to make the scheme even stronger, the Government has decided to slightly alter one aspect of the KiwiSaver home buyer programme in respect of second-chance home buyers.

The change being made from July aims to better help midlife, middle-income New Zealanders who have been through a separation or business failure and are struggling to get back into home ownership by enabling them to access their KiwiSaver funds.

The way the current scheme works is that it limits KiwiSaver withdrawals to first-home buyers and people who have previously owned property but have low assets and earnings. The asset limit is 20 per cent of the house-price caps of $550,000, $450,000 and $350,000, and the income limit is $120,000 for a couple and $80,000 for an individual.

The income limits are being removed on July 1, meaning a second-chance homeowner whose assets are small will be able to access their KiwiSaver funds to buy a home regardless of how high their income is.

We, of a certain age, long for the days of Home Ownership Accounts and tax breaks on savings that we enjoyed in the 1970s, and the interest rates our parents enjoyed - 3 per cent mortgage rates with government-guaranteed loans through the Housing Corporation. We can't wind the clock back completely, but current government assistance is blimming close.