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Homestart scheme tinkering: Little

NZ Newswire logoNZ Newswire 31/07/2016
Labour leader Andrew Little © Getty Images Labour leader Andrew Little

Labour leader Andrew Little says changes to KiwiSaver HomeStart loans are just tinkering.

The scheme started on April 1, 2015, and provides grants of up to $10,000 towards the deposit for the purchase of an existing home and grants of up to $20,000 for a newly built home.

Housing Minister Nick Smith has announced that from Monday the income caps will increase from $80,000 to $85,000 for a single person, and from $120,000 to $130,000 for a couple.

The house price cap in Auckland is now $600,000 for an existing home and $650,000 for a new home, with $500,000 existing/$550,000 new applying in Wellington, Christchurch, Hamilton, Tauranga, Queenstown and Nelson-Tasman and $400,000 existing/$450,000 new to the other areas of New Zealand.

Mr Little says the HomeStart scheme has been such a failure that even in a time of desperate housing need, $10 million in subsidies were not taken up last year.

"For those in Auckland, the government's failure to address the housing crisis means houses are simply not being built for $650,000," he said.

Dr Smith said a couple on an average income each of $60,000 could potentially afford a $650,000 home, by withdrawing $45,000 from five years invested in KiwiSaver, getting a $20,000 HomeStart grant for buying a new build, and being eligible for a Welcome Home Loan with a 10 per cent deposit, he said.

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