Low deposit home loans in NZ start from 5 or 10 percent down, so twenty percent is the default answer, not the only answer. Between lender programmes, new build exemptions, Kāinga Ora support and shared ownership, there is usually more room than a single bank will tell you about.
Twenty percent is the standard benchmark, but it is not a legal minimum. Most lenders will consider 10 percent for an existing home, and 5 percent is achievable in specific circumstances — through a Kāinga Ora First Home Loan if you are eligible, through particular lender programmes, or by buying a new build. New builds matter because they are exempt from the Reserve Bank’s LVR restrictions, so a lender can approve them at a higher loan-to-value ratio without it counting against the cap on its low-deposit lending. Borrowing above 80 percent normally attracts a low equity margin or fee, which falls away as your equity grows.
Low deposit lending is the part of the market that changes fastest, and it changes for reasons that have nothing to do with you.
The Reserve Bank sets a limit on what proportion of a bank’s new lending can go to low-deposit borrowers. That is a cap on the bank’s book, not on your application — but the practical effect is rationing. A lender that was actively writing 10 percent deposit loans in March can be effectively shut in April, simply because of where it sits against its own allocation. Nothing about your file changed. The queue did.
On top of that sit the Kāinga Ora products, which have their own eligibility criteria and income caps that are reviewed periodically, and lender-specific programmes that come and go. Keeping track of which door is currently open is most of the job.
Current Reserve Bank LVR and DTI settings are published on the Reserve Bank of New Zealand website, and Kāinga Ora eligibility on kaingaora.govt.nz.
A true no deposit home loan, where the lender advances 100 percent of the purchase price with nothing from you, is essentially unavailable from NZ banks. If you see a no deposit mortgage in NZ advertised, read the fine print closely.
What does exist is a way to buy with very little of your own cash. The main routes are your KiwiSaver savings, a gifted deposit from family, a guarantor or family security over a parent’s property, and the 5 percent options below. Family guarantees and gifts need care and independent legal advice. Use the deposit calculator or read how much deposit you need to buy a house in NZ to see where you sit.
The lowest deposits we see are 5 percent, mainly through the Kāinga Ora First Home Loan, BNZ’s low deposit lending or YouOwn shared ownership, subject to each scheme’s criteria. The costs, income caps and lender list are in our guide to 5% deposit home loans in NZ.
A 10 percent deposit is the realistic low deposit mortgage for most buyers of an existing home. Several banks and non-bank lenders consider it, but each has its own policy, pricing and appetite, and these change often, which is where a broker helps. Our guide to 10% deposit home loans in NZ lists who currently lends at 90%, what they want to see and a worked example.
A government-underwritten loan letting eligible first home buyers borrow with a smaller deposit through participating lenders. Income caps apply and are reviewed periodically. There’s no longer a house price cap.
Closed to new applications since September 2023. It was a shared ownership scheme where Kāinga Ora took a share of the home alongside you. Commercial shared ownership providers are the alternative today. See shared home ownership.
New builds sit outside the Reserve Bank’s LVR restrictions, so lenders can go to a higher loan-to-value ratio without it counting against their speed limit.
Individual banks periodically open specific low-deposit offers for first home buyers. They open and close with little notice.
Commercial shared ownership lets you buy a majority share now and the rest later. See our shared home ownership page.
A guarantee over a parent’s property, or a gifted deposit, remains the most common route to a low deposit purchase. Both need care and independent legal advice.
A pre-approval matters more when your deposit is small, for two reasons.
Get pre-approved first, or start with a mortgage quote to see where a low deposit puts you.
First, it tells you the truth about your number before you fall in love with a house. Low-deposit servicing is tighter, and the gap between what you assume you can borrow and what a lender will actually advance is usually wider than people expect.
Second, it makes you credible. A low-deposit buyer without pre-approval is the least attractive offer on the table. With one, you are competing on price rather than on doubt — and you can move at the speed the market expects.
Be aware that low-deposit pre-approvals are more often conditional, and can be subject to the lender’s available allocation at the time you find a property. That is worth understanding up front rather than discovering at the worst moment.
For an existing home, 10 percent is the realistic floor with most lenders, and 5 percent is possible in limited circumstances — through specific lender programmes, Kāinga Ora First Home Loan for eligible buyers, or with a new build. New builds are treated more generously because they sit outside the Reserve Bank’s LVR restrictions. See our guide to 10% deposit home loans.
The Reserve Bank limits the proportion of a bank’s new lending that can go to borrowers with small deposits. It is a cap on the bank’s overall book, not a ban on your loan. The practical effect is that low-deposit approvals are rationed: a bank may be enthusiastic one month and effectively closed the next, purely because of where it sits against its own limit.
Where you borrow above 80 percent of the property value, most lenders charge extra — either a margin added to your interest rate, or a one-off fee added to the loan. It typically falls away once your equity passes 20 percent, though you usually have to ask for it to be removed rather than it happening automatically.
Yes, materially. New builds are exempt from the Reserve Bank’s LVR restrictions, so lenders can approve them with a smaller deposit without it counting against their speed limit. For a buyer with a 10 percent deposit, that difference is often the whole decision.
Most first home buyers can withdraw their KiwiSaver savings towards a first home, leaving a minimum balance behind. It is one of the most common sources of a low deposit. Eligibility rules are set by government and change from time to time, so confirm your position with your scheme provider or on the Kāinga Ora website.
Not in the usual sense. NZ banks want some deposit, and the lowest is generally 5 percent, for example through the Kāinga Ora First Home Loan. Where people buy with little or no cash of their own, it’s usually because family provide a guarantee or security over their own property, or gift part of the deposit. Use the deposit calculator to see where you sit, or read how much deposit you need to buy a house.
Several NZ banks and non-bank lenders consider 10 percent deposit home loans, each with its own policy and appetite, and both change often. Our guide to 10% deposit home loans in NZ lists who currently lends at 90% and what they want to see.
Yes, through the Kāinga Ora First Home Loan, BNZ or YouOwn, if you meet the criteria. YouOwn lets you combine your 5 percent with up to 15 percent from them, with the bank lending 80 percent. See our guide to 5% deposit home loans in NZ or the Kāinga Ora First Home Loan guide.
Sometimes yes, sometimes no. Waiting avoids the low equity margin and widens your lender choice, but it also exposes you to price movement and more rent paid in the meantime. It is genuinely a numbers question and worth modelling both paths before deciding.
Kāinga Ora, BNZ and YouOwn explained, with the costs of borrowing above 80%.
Who lends at 90%, what they want to see and a worked example.
The full guide — KiwiSaver, grants, costs and the whole process end to end.
Buying a share now and the rest later, with family or a commercial partner.
See where your deposit sits as a percentage, and what it means for your options.
Tell us what you have saved and what you are looking at. We will tell you which doors are currently open, which are not, and what would change that.