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5% deposit home loans can be used for new builds

Posted 2 years ago | By Latitude Homes

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First Home Loan

Did you know that ‘Welcome Home Loan’ now has a new name? It’s now called the ‘First Home Loan’. Eligibility criteria and rules have also changed since October 2019, and they apply to new and existing homes. If you are planning to build a new home with Latitude Homes, here’s all you need to know.

5% deposit new minimum 

What is the ‘First Home Loan’?

Well it’s a Government-supported initiative to help first-home buyers get into the property market with a small deposit (less than 20%). If you’re a couple earning a combined $130,000 a year or $85,000 or less as an individual then you (and your partner) may qualify for this. 


The main changes announced by Housing New Zealand this year are:

  1. First Home Buyers can now apply for a First Home Loan with only a 5% deposit. This is for new builds and existing homes.
  2. Buyers are no longer required to live in the home for three years if they are buying a studio or one-bedroom home. You can sell after only 12 months.
  3. Up to 10% of KiwiBuild homes in each development can be over the price cap if they have four or more bedrooms. This will really help where extended families want to buy together, they can pool their resources to build or buy their dream home. View our house plans and get inspired


kiwi build cap lift


Some of the criteria and restrictions around being eligible for the First Home Loan are:

  • You can have a maximum yearly income of up to $85,000 (before tax) for 1 person. Or a combined maximum yearly income of $130,000 (before tax) for 2 or more people.

  • You will need a minimum deposit of 5% of the purchase price of the house you are wishing to buy.

  • There’s a house price cap. The price of the house you are buying with a First Home Loan must be less than the regional house price cap. Which ranges from $400,000 to $650,000 depending on if it's a new or existing house and where in New Zealand the house is.

  • You are a first-home buyer or a previous home owner, in a similar financial position to a typical first home buyer.

Do you have any questions?

You know that Latitude Homes do all that we can to make the building process “Too Easy” but for some people, the dream of building a new home comes crashing down when it comes to finding the finance to build. 


That’s why we have partnered with First Step Home Loans. They make it easier for first-time home buyers, and those new to building, to secure finance for a construction loan and ensure that they can confidently live their dream to build. They will be able to direct you to lenders that work with new builds and give you further information on the criteria you’ll need to meet. 

Ready to start? 


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We couldn't speak more highly of Haimona Matthews and his team at Latitude Homes Northland. Our home was built extremely well with good quality fittings and workmanship, with the added bonus of no holdups along the way. It was finished when they said it would be finished. The whole experience was stress less. Haimona was very approachable and kept us informed of how things were going as the build progressed and gave good advice when needed.

We would definitely recommend others using Latitude Northland and have been 'singing their praises' whenever we can.
Paul and Pat McKinney