How First-Home Income and Price Caps Work With KiwiSaver in NZ (2026): What Disqualifies You

The KiwiSaver first-home withdrawal has no income cap and no house-price cap. The caps that trip people up live in a different scheme, the First Home Loan. Here is where each one bites.

This article is general information only and is not personalised financial advice. It does not take into account your particular financial situation, goals or needs. Before acting, consider whether it's right for you and seek advice tailored to your circumstances.

A lot of confusion around first homes comes from mixing up two different things. People hear "income cap" or "price cap" and assume it must apply to their KiwiSaver. It usually does not. The cap they are thinking of belongs to a separate piece of government support, and it is easy to keep the two apart once you know which is which.

This guide separates the KiwiSaver first-home withdrawal from the First Home Loan, shows you exactly where the income caps apply, and explains what disqualifies you from the capped support while leaving the uncapped support fully intact.

TL;DR: The KiwiSaver first-home withdrawal has no income cap and no house-price cap — the only balance rule is that you must leave at least $1,000 in your account¹. The caps live in the separate First Home Loan: $95,000 before tax for a single buyer with no dependants, or $150,000 for two-plus buyers (or a single buyer with dependants)³⁴⁵.

Are there income limits on using your KiwiSaver for a first home?

No. The KiwiSaver first-home withdrawal does not test your income at all. There is no salary ceiling, no joint-income line you can cross, and no clawback if you earn well. If you are eligible to make the withdrawal, your income is simply not part of the assessment¹.

This is the single most useful thing to understand here, because it removes a worry many people carry for no reason. A couple on a strong combined income can use their KiwiSaver toward a first home in exactly the same way as a couple on a modest one. The amount you can withdraw is driven by your balance, not by what you earn.

The rules that actually apply to the withdrawal are about membership and intent, not money:

• You must be using the home as your principal place of residence — you cannot use the withdrawal for an investment property or a holiday home².
• You must leave at least $1,000 in your KiwiSaver account after the withdrawal¹.

So when people ask about "first home loan income price caps and KiwiSaver" in NZ, the honest answer is that the income and price caps they have read about belong to a different scheme. The KiwiSaver part is uncapped.

Why the KiwiSaver withdrawal itself has no income or price cap

The KiwiSaver first-home withdrawal is, in effect, you taking out your own savings. The money is yours, plus your employer's contributions and any government contributions you have earned over the years. Because it is your own accumulated money rather than a means-tested government grant, there is no income test to qualify and no maximum value placed on the house you buy¹.

That structure matters. A grant is the government giving you money it needs to ration, so it sets eligibility limits. A withdrawal is the scheme releasing money you already own for an approved purpose. The approved purpose is buying a first home you will live in, and the only guardrail on the money side is the $1,000 you must leave behind to keep your account open¹².

It is worth being clear about what this is not. It is not free money, and it is not guaranteed to grow before you withdraw it. KiwiSaver is an investment, so the value of your balance can go down as well as up, particularly if you are in a higher-volatility fund close to when you plan to buy. How much you can put toward a deposit depends on what your balance is worth at the time you withdraw, which is one reason fund choice in the few years before buying is worth a conversation.

For the full step-by-step on timing, eligibility and how the money is paid to your solicitor, see our guide to the KiwiSaver first-home withdrawal rules and process.

Where caps DO apply: the First Home Loan

The caps people worry about sit on the First Home Loan, which is a separate Kainga Ora scheme. It is not the same thing as your KiwiSaver, and you do not have to use one to use the other, though many first-home buyers use both together.

The First Home Loan lets eligible buyers get into a home with a smaller deposit. Most lenders want around 20% of the purchase price as a deposit. The First Home Loan lets approved lenders accept a deposit of as little as 5%, counting all your savings, any gifts, and your KiwiSaver first-home withdrawal toward that 5%⁶.

That lower deposit comes with conditions, and this is where the income caps live:

• A single buyer with no dependants must have a before-tax income of $95,000 or less over the previous 12 months³.
• Two or more buyers must have a combined before-tax income of $150,000 or less over the previous 12 months, whatever the number of dependants⁴.
• A single buyer with one or more dependants gets the higher $150,000 cap, matching the two-plus-buyers figure⁵.

There are also non-income conditions on the First Home Loan. You must be buying the home as your primary place of residence, not own any other property or land, and be buying a property of less than 1 hectare⁹. And there is a cost to factor in: First Home Loan borrowers pay a 1.2% Lender's Mortgage Insurance premium on the loan amount, which can be paid up front or added over the life of the loan⁸.

Two-buyer vs single-buyer income caps

Because the cap depends on who is buying and whether there are dependants, it helps to see the three situations side by side. Note that the single-with-dependants cap and the two-plus-buyers cap are the same figure.

Source: Kainga Ora First Home Loan eligibility criteria, as at 7 April 2025³⁴⁵.

The practical point is that these caps decide whether you can use the First Home Loan's 5% deposit pathway, not whether you can use your KiwiSaver. If your income is over the relevant cap, you are simply outside the First Home Loan. Your KiwiSaver first-home withdrawal stays fully available¹.

Does the price of the house affect your KiwiSaver eligibility?

No, on two fronts. The KiwiSaver first-home withdrawal has no house-price cap¹. And the First Home Loan no longer has one either — the regional house-price caps that used to apply were removed entirely in 2022, so there is no maximum property value attached to the First Home Loan today⁷.

What this means in practice is that, on the support side, the value of the house you buy does not by itself rule you in or out of either scheme. The First Home Loan is driven by the income caps and by whether a lender will lend you the money, not by a price ceiling⁷.

That last part matters. Removing the price cap does not remove the lender's own serviceability test. A bank still has to be satisfied you can afford the repayments, and on a higher-priced home a smaller deposit means a larger loan to service. So while there is no formal price cap, the price of the house still feeds into whether a lender will approve you. The cap is gone; the affordability maths is not.

What disqualifies you from the capped support (and what still works)

It is worth being precise about what each rule does and does not knock out. The table below maps the three main first-home pathways against the three tests people ask about.

Caps that apply to first-home support in NZ

Source: Inland Revenue and Kainga Ora eligibility criteria, as at 7 April 2025¹³⁴⁷.

A few things can disqualify you from the capped First Home Loan support while leaving the uncapped KiwiSaver withdrawal untouched:

• Income over the cap. A single buyer earning above $95,000 with no dependants, or buyers earning above $150,000 combined, are outside the First Home Loan³⁴. Their KiwiSaver withdrawal is unaffected¹.
• Owning other property or land. The First Home Loan requires that you do not own any other property or land⁹. The KiwiSaver withdrawal has its own first-home test rather than a blanket property rule, which is worth checking case by case.
• A property of 1 hectare or more. Lifestyle blocks at or over 1 hectare fall outside the First Home Loan⁹.

If you have owned a home before, you may still have a route in through the second-chance pathway, which applies an asset test rather than ruling you out automatically. We cover how that test works in our guide to the KiwiSaver second-chance asset test cap.

Everyone who clears the income caps should also know that the First Home Grant has ended — it stopped taking new applications and is no longer part of the toolkit, which changes the maths for some buyers. We explain what replaced it in the First Home Grant has ended: what replaced it.

How to check which support you actually qualify for

The clean way to think about it is to run the two schemes as separate tests, in this order:

1. Confirm the KiwiSaver withdrawal first. It has no income or price cap, so for most members the question is membership length, principal-residence intent, and leaving $1,000 behind¹². This is your baseline, and it rarely disqualifies people on the money side.

2. Then test the First Home Loan caps. Work out your before-tax income over the last 12 months and match it to the right cap for your household³⁴⁵. If you are under, the 5% deposit pathway is open, subject to a lender approving you and the 1.2% premium⁶⁸.

3. Factor in the non-income rules. No other property or land, primary residence, under 1 hectare⁹.

If your income is over the First Home Loan cap, you are not stuck. You still have your KiwiSaver withdrawal, and you can pursue a standard mortgage on whatever deposit you have assembled. The capped support is a bonus, not a gate on home ownership.

For a fuller walkthrough of combining your withdrawal with the low-deposit pathway, see KiwiSaver, your first home and the low-deposit First Home Loan.

A note on scope: Smiths Financial does not provide mortgage advice. The First Home Loan figures here are general information drawn from Kainga Ora's published criteria, and a mortgage adviser or your lender is the right person to confirm serviceability and approval for your situation.

Frequently asked questions

Is there an income limit on using KiwiSaver for a first home? No. The KiwiSaver first-home withdrawal does not test your income. There is no salary ceiling and no joint-income limit on the withdrawal itself — the income caps people read about belong to the separate First Home Loan¹³.

What is the income cap for the First Home Loan? A single buyer with no dependants must earn $95,000 or less before tax over the previous 12 months. Two or more buyers, or a single buyer with dependants, can earn up to $150,000 combined before tax³⁴⁵.

Is there a house-price cap on KiwiSaver or the First Home Loan? Neither has one. The KiwiSaver withdrawal has never had a price cap, and the First Home Loan's regional price caps were removed in 2022. Eligibility is driven by income and lender serviceability, not by the price of the house¹⁷.

What disqualifies me from the First Home Loan but not my KiwiSaver? Earning over the income cap, owning other property or land, or buying a property of 1 hectare or more can rule you out of the First Home Loan³⁴⁹. None of these removes your KiwiSaver first-home withdrawal, which has its own separate first-home test¹.

How much deposit do I need with a First Home Loan? At least 5% of the purchase price, counting your savings, any gifts and your KiwiSaver withdrawal, compared with the roughly 20% most lenders ask for. A 1.2% Lender's Mortgage Insurance premium applies to the loan⁶⁸.

Can I use my KiwiSaver if my income is too high for the First Home Loan? Yes. Being over the First Home Loan income cap has no effect on your KiwiSaver first-home withdrawal. You can still withdraw and put it toward a standard mortgage deposit¹³.

This article is general information only and is not personalised financial advice. It does not take into account your particular financial situation, goals or needs. Before acting, consider whether it's right for you and seek advice tailored to your circumstances. KiwiSaver is a long-term savings scheme; government contributions, contribution rates, withdrawal rules and tax (PIR) settings are set by the Government and can change. Figures are correct as at 7 April 2025 — check current rules at ird.govt.nz, kaingaora.govt.nz and sorted.org.nz. Smiths Financial does not provide mortgage advice; please consult an appropriately authorised professional. Craig Smith Business Services Ltd (FSP712931), trading as Smiths Financial, holds a Class 2 licence issued by the Financial Markets Authority and is a member of the Financial Dispute Resolution Service (FDRS). Written by Henry Smith, Financial Adviser; reviewed by Craig Smith, Principal Adviser. Last reviewed 7 April 2025.