Easiest Bank To Get A Home Loan in New Zealand [2024]

“Kiwibank in Christchurch”

During times when interest rates are rising exponentially, getting a home loan with the best terms is crucial. Generally, New Zealand banks approve loans with a deposit starting at 20%, however, there are some options allowing people to acquire property with a lower investment.

The easiest banks to get a home loan in New Zealand include Squirrel – Launchpad, the Co-operative Bank, TSB, and Kiwibank. They are also best for first-home buyers with a low budget. Moreover, if you don’t have 20% for the deposit, you can use different schemes such as First Home Loan, where you can get a home loan with only 5% of the property price in savings.

Buying a house is a dream of many New Zealanders, and fortunately, you don’t need to have a high deposit to own a home! In this article, we explain what are the easiest and most accessible ways to get a home loan in New Zealand, regardless of your financial situation.

Also read: Best NZ banks for all purposes.

Getting a mortgage in New Zealand: requirements

Before you apply for any loan, you must ensure your eligibility for a mortgage. Here are the standard requirements for getting a mortgage in New Zealand:

  • You must be a New Zealand citizen or permanent resident
  • Evidence of income – recent payslips;
  • If self-employed – the last two year’s full tax returns, yet, it’s more difficult to get a loan as self-employed
  • Ratio of income and debt – you must be able to afford a loan; provide, e.g., statements for savings accounts, statements for credit cards, personal loans, leases, etc.
  • Minimal deposit – at least 5% of the property price

Moreover, if you want to get a home loan with only a 5% deposit, e.g., via First Home Loans, you need to meet further requirements:

  • You must be planning to live in the house you are buying for at least 6 months
  • You must not already own any property
  • Your household income for the 12 months before you apply must have been:
    • Less than $95,000 for individuals
    • Less than $150,000 combined if you are buying the property with other people

Minimum deposit

  • To get a home loan in New Zealand, you need to have at least 20% of the property price for the initial deposit.
  • That said, some state programs allow first-time home buyers to buy a house with only a 5% deposit.
  • Besides, banks lend construction loans with just 10% if you plan to build your home.

How much can you borrow?

The maximum amount of the loan depends mainly on the number of borrowers, their annual income, deposit, and ongoing expenses.

Loan duration

Be prepared to pay your mortgage for some time. The standard home loan term in New Zealand is 30 years. The longer the borrowing time, the lower your monthly repayments are. However, in the end, your mortgage will be more expensive, hence, you will pay a large sum in total compared to a shorter term.

Home loans with low deposit

There are limited ways of buying a home with a minimal deposit, such as 5% or 10%. The standard required deposit is 20%. Here are the most common schemes to get a mortgage with a minimum deposit:

  • Use KiwiSaver
  • Use First Home Loan – you need at least 5% of the value of the property
  • Build your first home –  you may get away with a 10% deposit 

Some banks will lend you money even with less than a 20% deposit, assuming you have a good income, a secure job, and no additional debts that might affect your ability to repay the loan.

Keep in mind if banks offer home loans with 10% to 15% deposit, the interest rates are usually higher if you were depositing 20%+ of the property price. Moreover, the latest RBNZ mortgage figures show that the most recent first-home buyers in New Zealand (68%) had a deposit of at least 20%.

Since house prices range widely depending on the location, here is how much you will need to save for a 10% or 20% deposit:

CityMedian price10% deposit20% deposit
Bay Of Plenty$857,000$85,700$171,400
Hawke’s Bay$687,500$68,750$137,500
West Coast$420,000$42,000$84,000
Source: Canstar.co.nz; Reinz

1. First Home Loan scheme: how does it work?

The First Home Loan is one of the most common ways to get a home loan with a minimal deposit. In fact, just 5% of the property price might be enough.

The First Home Loan is a financial support program offered by Kāinga Ora (Homes and Communities), which acts as an underwriter on the loans. However, this scheme is only suitable for first-time home buyers. Moreover, this program includes some price gaps where you can’t purchase a house above a particular amount, which ranges within regions.

Here are the main requirements you need to meet to qualify:

  • Be over 18
  • Have at least 5% for the deposit
  • Have earned less than the income caps in the last 12 months
  • Not owning any property or land
  • Have been contributing at least the minimum amount to KiwiSaver (or complying fund or exempt employer scheme) for 3 years or more
  • A property must be within the regional house price caps
  • Live in your new house for at least 6 months

Income requirements for First Home Loan

Besides above mentioned requirements, in the 12 months before you apply, you must have earned:

  • $95,000 or less before tax for an individual buyer
  • $150,000 or less before tax for an individual buyer with one or more dependents
  • $150,000 or less before tax for 2 or more buyers, regardless of the number of dependents

Below you can see price caps that apply as of 15 May 2023:

RegionExisting properties ($)New properties ($)
Far North District400,000675,000
Whangārei District600,000800,000
Kaipara District525,000875,000
Thames-Coromandel District875,000925,000
Hauraki District550,000650,000
Matamata-Piako District625,000800,000
Hamilton Urban Area (Hamilton City, Waipā District, Waikato District)650,000775,000
Ōtorohanga District400,000650,000
South Waikato District400,000650,000
Waitomo District400,000650,000
Taupō District575,000825,000
Tauranga Urban Area (Tauranga, Western Bay of Plenty District)800,000875,000
Rotorua District525,000650,000
Whakatāne District500,000800,000
Kawerau District400,000650,000
Ōpōtiki District400,000650,000
Gisborne District450,000650,000
Wairoa District400,000650,000
Napier-Hastings (Napier City, Hastings District)625,000825,000
Central Hawke’s Bay District500,000650,000
New Plymouth District525,000675,000
Stratford District400,000650,000
South Taranaki District400,000650,000
Ruapehu District400,000650,000
Whanganui District425,000650,000
Rangitikei District400,000650,000
Manawatū District525,000650,000
Palmerston North City575,000700,000
Tararua District400,000650,000
Horowhenua District525,000650,000
Wairarapa (Masterton District, Carterton District, South Wairarapa District)600,000800,000
Wellington Urban Area (Kāpiti Coast District, Upper Hutt City, Porirua City, Lower Hutt City, Wellington City)750,000925,000
Nelson-Tasman (Nelson City, Tasman District)650,000875,000
Marlborough District550,000650,000
Kaikōura District700,000700,000
Buller District400,000650,000
Grey District400,000650,000
Westland District400,000650,000
Hurunui District425,000650,000
Christchurch Urban Area (Waimakariri District, Christchurch City, Selwyn District)575,000775,000
Ashburton District400,000650,000
Timaru District400,000650,000
Mackenzie District500,000650,000
Waimate District400,000650,000
Waitaki District400,000650,000
Central Otago District525,000800,000
Queenstown-Lakes District875,000925,000
Dunedin City500,000675,000
Clutha District400,000650,000
Southland District500,000650,000
Gore District400,000650,000
Invercargill City400,000650,000
Source: kaingaora.govt.nz

How much do houses cost in New Zealand? Find out in the dedicated guide.

Not all NZ banks participate in the First Home Loan scheme, here are some of them:

  • Westpac
  • TSB
  • Kiwibank
  • The Co-operative Bank
  • SBS
  • NZCU (New Zealand Credit Union)
  • NZ Home Loans
  • Nelson Building Society

There are some pros and cons to taking a First Home Loan, namely:


  • Opportunity to buy a home without large investment: Not everyone has hundreds of thousands sitting in their bank account to spend on their deposit. With First Home Loan, you can buy your own place with less than $50,000 in savings.
  • Owning a home faster than it can be: Owning a property is always a good deal doesn’t matter what. Financially, you will be in a better situation when having your own house, which is growing in value year after year.
  • Chose the structure of the loan: You can decide if you want to borrow with a fixed rate, a variable rate, an offset mortgage, or a combo of them.


  • LMI (Lenders Mortgage Insurance) costs: Using the First Home Loan scheme, you’ll pay 1% of the mortgage balance extra as a one-off fee, which is usually added to the loan balance. This will usually mean an extra $3,000 to $5,000, depending on the size of the loan.
  • You will have a larger loan with higher monthly repayments: Because of the minimal deposit, your mortgage will be quite large, and so will monthly payments.

Not all NZ banks participate in the First Home Loan scheme, here are some of them:

  • Westpac
  • TSB
  • Kiwibank
  • The Co-operative Bank
  • SBS
  • NZCU (New Zealand Credit Union)
  • NZ Home Loans
  • Nelson Building Society

2. Housing association support

Housing associations such as the New Zealand Housing Foundation allow you to buy part of a house but live in the whole dwelling. For instance, they offer Welcome Home Loans, where you can get a mortgage with only a 10% deposit.

While you get a mortgage from a normal bank, as usual, the homeownership is shared with the association until you have the money to buy the whole house. They don’t charge you a penny. Additionally, you can sell your share in the house if something changes.

Therefore, The Housing Foundation support arrangement is a great way to own equity if you don’t have the money to buy an entire home.

3. KiwiSaver

KiwiSaver helps first-home buyers by providing a First Home Grant if they meet the criteria. To qualify, you must have been contributing to your KiwiSaver fund for at least three years or more. Below are the grants KiwiSaver offers:

  • Up to $5,000 for individuals and up to $10,000 for two or more eligible buyers to put towards the purchase of an existing/older home
  • Up to $10,000 for individuals and up to $20,000 for two or more eligible buyers to help with the costs of purchasing a brand-new home

Generally, you receive $1,000 for each year you have been a KiwiSaver member for up to a total of five years. This means you could get $3,000, $4,000, or $5,000 to put towards a deposit. If you’re buying a new build, the grant doubles to $2,000 per year.

4. Building your own house

Lastly, some banks will lend you money with a lower deposit if you decide to build your own house instead of buying an existing one. It also applies to property at the early stage of construction and buying from a developer within six months of completion.

In that situation, the LVR rules won’t apply, hence, a deposit of 20% isn’t required. The exact deposit requirement will depend on the bank and your situation, but as a rule, you can count on 10%.

Looking for a budget way to build your own house?

Other expenses related to buying a home in New Zealand 

Don’t forget that the price you pay for a house isn’t the only expense you should budget for. Here are all the related costs that go into acquiring in New Zealand:

  1. Legal fees – Buying real estate also includes hiring a lawyer in order to transfer the ownership. It’s advisable to budget around between $1,000 to $3,500.
  2. Building inspection or Registered valuation – While building inspection is up to you, registered valuation is often required by the bank if the house is bought with less than a 20% deposit. It can cost from $500 to $2,000, depending on house size and location, and additional tests.
  3. Interest rates: When you lend money from the bank, you always have to pay interest rates. Yet, if you are taking a loan with a lower-than-usual deposit, you might run into higher interest rates (unless you are in the First Home Loan scheme).
  4. The LMI fee – because you are lending money with a lower deposit and avoid LEM, you pay 1% of the borrowed amount as Lending Mortgage Insurance. If your mortgage is $450,000, you’ll need to either pay $4,500 upfront or have it added to the loan.
  5. Moving costs – moving costs can range drastically depending on your possessions and location. You can expect anything from $200 to $1,000.
  6. Furniture and fittings – here are also no set limits, depending on your needs and taste, you can budget from several hundred to tens of thousands of dollars. Generally, furnishing a two-bedroom house with the cheapest but new furniture will set you back by $5,000 to $10,000.

Best banks for first home buyers in New Zealand

So, now you are aware of what schemes are available for someone with a low deposit. Here are the best banks to take a home loan as a first-time buyer on a budget if you want to go straight to the lender.

Squirrel – Launchpad

Launchpad is a hybrid blend of a regular mortgage and a personal loan. It’s designed specifically for FHBs who earn too much to qualify for government assistance but still need a little help with their deposit.

Saving for a traditional 20% deposit can add years to saving for a first home. But Launchpad cuts the deposit needed to 5% for properties up to $800k and up to 10% for more expensive homes.

House price Maximum LVR
(Loan-to-value ratio) 
Minimum deposit Launchpad loan
Source: www.canstar.co.nz

The Co-operative Bank

The Co-operative Bank doesn’t offer cash incentives or low initial deposits, however, first-time home buyers can enjoy a special interest rate of 6.59% p.a. for one year fixed. The offer is also available for Kāinga Ora First Home Loans.


TSB is a small bank but has the highest satisfaction among its customers. Their home loans start at 6.49% p.a., which is fixed for 2 years.

Here are the current rates of home loans at TSB Bank:

TermSpecial Rate (Minimum 20% deposit)Standard Rate (Less than 20% deposit)
6 months6.99% p.a.7.79% p.a.
1 year6.99% p.a.7.79% p.a.
18 months6.75% p.a.7.55% p.a.
2 years6.49% p.a.7.29% p.a.
3 years6.39% p.a.7.19% p.a.
4 years6.29% p.a.7.09% p.a.
5 years6.29% p.a.7.09% p.a.
Housing variable8.64% p.a.9.44% p.a.
Revolving credit8.74% p.a.
Source: www.tsb.co.nz


Kiwibank is a reputable NZ bank and is a provider of home loans for many Kiwis. At the moment, they offer the following rates:

  • 6.89% – fixed for one year
  • 6.59% – fixed for 2 years
  • 8.50% – variable

Below is a detailed overview of their interest rates:

TermSpecial interest rate if you have more than 20% equityStandard interest rate if you have less than 20% equity
6 month fixed7.15% p.a.8.15% p.a.
1 year fixed6.89% p.a.7.89% p.a.
2 year fixed6.59% p.a.7.59% p.a.
3 year fixed6.29% p.a.7.19% p.a.
4 year fixed6.15% p.a.7.05% p.a.
5 year fixed6.29% p.a.7.19% p.a.
Variable8.50% p.a.8.50% p.a.
Offset variable8.50% p.a.8.50% p.a.
Revolving8.55% p.a.8.55% p.a.
Source: kiwibank.co.nz

NZ Home Loans

New Zealand Home Loans is a large mortgage brokerage that is solely dedicated to helping people pay off their mortgages faster. Therefore, it’s a great company for someone who already has a mortgage.

Yes, NZHL will restructure your current loan and help you pay it off. But to do so, they need to move your mortgage to one of the lenders they work with. Kiwibank is one of the main lenders NZHL works with, among others. In fact, NZ Home Loans is owned by Kiwibank.

Interest rates on home loans in New Zealand 

“ANZ bank in Christchurch”

All mortgages come with interest rates, or what the bank charges you for loaning the money. There are 4 main variations among interest rates which you can choose from:

  1. Fixed – the interest rate won’t change or be affected by the market.
  2. Floating/Variable – the interest rate will move with the market.
  3. Combine Fixed and Floating/Variable is one of the best options.
  4. Revolving – the interest rate will move with the market.

Below are interest rates at the largest NZ banks as of July 2023:

Source: www.opespartners.co.nz

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