How to Supercharge Your First Home Deposit in New Zealand

Why Your Deposit is Such A Key Part Of Buying Your First Home

For most New Zealanders, the biggest hurdle to buying a first home isn't finding the property - it's pulling together the deposit. With a 20% deposit target, this is $160,000 on an $800,000 home. For many first home buyers, that number looks daunting.

The good news is that you don't necessarily need 20%. Some banks, and products like the Kainga Ora First Home Loan, allow deposits as low as 5%. Still, the larger your deposit, the better your options: fewer lending restrictions, lower Low Equity Margins (LEM), and access to sharper interest rates. For a detailed breakdown of deposit requirements, see our guide on how much deposit you need as a first home buyer.

The key is to use every tool available to accelerate your savings and take advantage of government programmes, employer schemes, and smart providers.

Harnessing KiwiSaver for Maximum Impact

For most New Zealand first home buyers, KiwiSaver is the single most powerful tool in building a deposit. Since its introduction in 2007, KiwiSaver has become the backbone of deposit strategies. Learn more in our guide to 5 tips to boost your KiwiSaver.

Withdrawing for Your First Home

If you've been a KiwiSaver member for at least three years, you may be able to withdraw nearly all your savings (except the $1,000 kick-start). This can easily amount to tens of thousands of dollars that can go straight toward your deposit.

The process involves applying through your KiwiSaver provider and providing a copy of the sale and purchase agreement. Lenders and lawyers are very familiar with the process, but it's important to factor in processing time - often 10 - 15 working days.

For more detail on how KiwiSaver interacts with your deposit, check our Home Loan Pre-Approval guide, where we cover the key documents and timing.

Wedge: A Modern Deposit Accelerator

In addition to KiwiSaver, some people choose to consider other savings options when building a house deposit. One example is Wedge, which is not a bank account. Wedge is a licensed savings fund managed by Wedge Management Limited, regulated by the Financial Markets Authority and supervised by The New Zealand Guardian Trust Company.

Wedge operates the Wedge Savings Fund, which invests in wholesale cash and fixed-interest assets. These asset types are generally used for lower-risk investment strategies, although returns are not guaranteed. As at October 2025, the fund publishes a "Set Rate" of approximately 3% p.a., with interest calculated daily and compounded monthly. Rates and returns may change over time.

Opening an account typically involves downloading the Wedge app, completing identity verification, and transferring funds using a unique reference provided by Wedge.

Setting Up Smart Savings Systems

While KiwiSaver and Wedge provide big boosts, the day-to-day savings habits you build are just as important.

Automating Savings

One of the simplest ways to grow your deposit is to "pay yourself first". Set up an automatic transfer from your income account to a high-interest savings account the day your pay goes in. This ensures you save before you spend.

Cutting Lifestyle Costs

For many first home buyers, small sacrifices can add up. Reducing discretionary spending on subscriptions, dining out, or overseas holidays might not feel glamorous, but every dollar saved is a dollar closer to your first home. For practical ideas, check out our tips for saving money when the cost of living is high.

We recommend using tools like budget apps or even a simple spreadsheet to track your spending. Our guide on 7 steps to creating a monthly budget provides a clear framework for budgeting that helps you reach your savings goal.

Exploring Support Options Beyond KiwiSaver

Kainga Ora's First Home Loan scheme deserves attention. This allows eligible buyers to purchase with a smaller deposit, with the government underwriting the risk for the lender.

While interest rates are the same as the bank advertised rates, the ability to enter the market earlier can be game-changing. The key is to balance the opportunity with affordability - a smaller deposit means a larger mortgage.

Family Assistance: Gifts and Guarantees

Family support remains a cornerstone of many first home deposit strategies in New Zealand. There are several common ways parents or whanau contribute:

For more details, see our Deposit Options guide.

Growing Your Deposit Through Shares Investment

For buyers with a longer timeframe, investing outside of KiwiSaver can be an option. While higher-risk investments like shares or managed funds aren't appropriate for money you'll need in the next two years, they can help accelerate savings if your buying horizon is three to five years.

Share trading providers like Sharesies, Hatch, and Tiger Brokers offer investment apps that can complement your deposit strategy. The key is to match the investment risk with your timeframe and risk profile - and always seek financial advice.

Avoiding Common Deposit Pitfalls

It's easy to lose momentum when saving for a deposit. Common pitfalls include:

Reviewing Your Progress Regularly

Building a deposit is a journey. Checking in quarterly on your progress helps keep momentum. Review how much you've saved, whether your KiwiSaver contributions are on track, and whether additional tools like Wedge could help you bridge the gap faster.

Banks also update their lending criteria regularly, so staying connected with an adviser or lender about deposit requirements is critical. Our Members Area includes tools and resources to help track and boost your deposit journey.