Government trumpets jump in KiwiSaver first home buyer stats

For some it's curious that money put into New Zealand's only savings scheme can be diverted into the property market.

The number of first home buyers using KiwiSaver to get onto the first rung of the property ladder has increased seven fold over the past two years, Housing Minister Nick Smith and Revenue Minister Todd McClay announced today on KiwiSaver’s sixth birthday.

“KiwiSaver has enabled 10,733 New Zealanders to put down a deposit on their first home in the year to March. That is up from 5,737 in 2012 and 1,274 in 2011. We want New Zealand to be a country where owning your own home is an achievable aspiration and this seven fold increase in two years is hugely encouraging,” Dr Smith says.

“The withdrawn savings for first home buyers this year totalled $120.2 million, up from $57.2 million in 2012 and just $12.3 million in 2011. The fact the scheme is getting real momentum in helping first home buyers get a deposit for their first home is great news.

“The government is also increasing its contribution to support KiwiSaver first home buyers. A deposit subsidy of $1000 per year of contribution is available for up to five years. 4488 subsidies worth $15.7 million were paid out in the financial year to May, up from 3163 and $9.5 million in 2012 and 1071 and $2.8 million in 2011. Additional funding was provided in Budget 2013 to help fund this growth.

“My message to young people aspiring to own their own home is that KiwiSaver works. It is a very positive result that to date the initiative has provided $217.6 million of people’s own savings and government grants towards the purchase of a first home.”

Revenue Minister Todd McClay says since KiwiSaver was launched in 2007 2.1 million New Zealanders have joined, with 25,000 new enrolees last month.

“This is a tremendous achievement and highlights not only New Zealanders’ awareness of the need to save for their retirement but also their commitment to do something concrete about it,” Mr McClay says.

“KiwiSaver is a significant complement to New Zealand Superannuation that ensures kiwis will be more financially secure in their retirement. The growing KiwiSaver investment also provides a very important source of investment funds for New Zealand’s economy," Mr McClay says of the scheme, introduced by Labour in 2006.

“The marked increase in KiwiSaver members being able to access early their savings towards first home purchases also shows the benefit of having a practical and flexibly designed scheme that allows KiwiSavers' to invest in their most important asset – a family home.”