One of the most common questions I get from first home buyers in New Plymouth is: "How much do I actually need saved before I can buy?"
The honest answer is — it depends on a few factors. But the good news is that the numbers might be more achievable than you think, especially when you factor in KiwiSaver and the First Home Grant.
Let's break it down properly.
The minimum deposit in New Plymouth: 10% or 20%?
Most lenders require a minimum deposit of 20% for standard home loans. However, under the Reserve Bank's LVR (Loan to Value Ratio) rules, lenders can approve a certain number of loans at less than 20% deposit — usually 10%.
This means that in practice, many first home buyers in New Plymouth can get approved with as little as a 10% deposit — but competition for these spots can be tight, and you'll typically pay a slightly higher interest rate than someone with 20% saved.
The bottom line for New Plymouth: With a 10% deposit target, you're looking at roughly $55,000–$75,000 for most properties in New Plymouth's current median price range. With 20%, that rises to $110,000–$150,000. KiwiSaver and the First Home Grant can make a big dent in both of these numbers.
What does a 10% and 20% deposit look like in New Plymouth's market?
New Plymouth's median house price has fluctuated but has broadly sat in the $550,000–$750,000 range for standard residential properties. The neighbourhood you're looking in makes a significant difference — entry-level properties in Waitara or parts of Strandon can come in well below the median, while properties on the hill suburbs command premiums.
| Purchase Price | 10% Deposit Needed | 20% Deposit Needed |
|---|---|---|
| $450,000 | $45,000 | $90,000 |
| $550,000 | $55,000 | $110,000 |
| $650,000 | $65,000 | $130,000 |
| $750,000 | $75,000 | $150,000 |
These are deposit figures only — you'll also need to budget for legal costs (around $1,500–$2,500), a building inspection ($500–$900), and potentially LIM reports and other due diligence costs.
How KiwiSaver can help
This is where things get interesting for many first home buyers. If you've been contributing to KiwiSaver for at least three years, you can withdraw most of your balance (leaving $1,000 in the account) to use toward a first home purchase.
Depending on how long you've been contributing and what rate you've been contributing at, your KiwiSaver balance could be anywhere from a few thousand dollars to $30,000, $40,000, or more. For a couple buying together, you could be accessing two KiwiSaver balances — which can make a significant difference.
The First Home Grant — up to $10,000 per person
On top of your KiwiSaver withdrawal, you may also qualify for the First Home Grant — a government grant of up to $5,000 per person for an existing home, or $10,000 per person for a new build. For a couple buying together, that's potentially $10,000–$20,000 in additional grant money.
To be eligible, you need to have been contributing to KiwiSaver for at least three years, meet income caps (currently $95,000 for a single buyer, $150,000 combined for two buyers), and the property price must be within the regional cap. In Taranaki, the price caps are set at a level that covers the large majority of properties in the region.
Example: A couple in New Plymouth with three years of KiwiSaver each — one with $25,000, one with $18,000 — could access $43,000 from KiwiSaver plus up to $10,000 in First Home Grants. That's $53,000 toward a deposit before they've touched their own savings. Combined with their personal savings, a $550,000 property becomes very achievable.
What do lenders actually look at beyond the deposit?
Having the deposit is only one part of the picture. Lenders also assess:
Income and affordability: Can you service the loan? Lenders typically apply a stress-test rate several percent above the current mortgage rate to make sure you could still afford repayments if rates rose.
Existing debts: Student loans, car loans, credit card limits, and buy-now-pay-later accounts all reduce your borrowing capacity — even if you don't have a balance outstanding on them.
Savings history: Banks like to see that your deposit has been genuinely saved over time — not borrowed or gifted at the last minute. A consistent savings pattern over 3–6 months looks good.
Employment type: Permanent employment is most straightforward. Self-employed buyers face additional requirements — if that's you, see my guide to self-employed mortgages.
So — what should you do first?
The most valuable thing you can do before you start house hunting is to understand your exact numbers. How much you can borrow, how much your KiwiSaver is worth, whether you qualify for the First Home Grant, and what repayments would look like on different purchase prices.
That's exactly what I do in a first consultation — and it's completely free and obligation-free. Most people come away from that conversation with a much clearer picture of where they stand and a realistic timeline for getting into their first home.