New Government Price Caps and the Situation for KiwiBuild
Wednesday 30 January 2019, 7:31PM
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The government has recently upped the price cap for housing programmes in main centres. Real estate lawyers and property solicitors have to be aware of the Welcome Home Loan and HomeStart Grants’ new caps - these are programs that Kiwis can use to look for their new homes. From $450,000, the government has allotted a new cap of $500,000 for homes outside Auckland or Queenstown.
The Welcome Home Loan and HomeStart Grants follow the FirstHome initiative, which helps qualified buyers look at homes with a 10% grant from the purchase price, capped off at $20,000. This grant is supposed to help a first home buyer find a house that’s affordable and enable couples and families with lower incomes look for homes to live in.
A remaining problem lies in the lack of interest most areas have shown for KiwiBuild homes. These have remained out of reach for most of those recipients they are supposedly meant for. The government has already enacted policies to help the caps align with each other - population centres in Christchurch and Wellington have already given a cap of $550,000 for new builds, levelling them at a constant of $500,000 for all homes.
Another problem revolves around most KiwiBuild recipients earning salaries well below the required caps. The Government hopes that this will change with a shift in leniency for both HomeStart and Welcome Home Loans, lowering the requirements for more recipients.
As an example of the lack of buyers for KiwiBuild homes, only seven out of 10 homes were purchased in the Wanaka territory during the first-round ballot. It’s also evident across the Onehunga development that houses haven’t been taken as fast as they should have.
To date, HomeStart and Welcome Home Loan policies haven’t been as people friendly as they should have been. HomeStart requires its loaners to have constantly been saving for KiwiSaver for a period of three years. Banks have also already started to offer low-deposit loans, making changes hard for Welcome Home Loan.
With all these issues happening, Home Legal’s service in conveyancing and home moving is more needed than ever. For more help concerning first home moving, visit https://homelegal.co.nz/ now.