If you are buying a home you intend to live in, a 20% deposit is generally the preferred target in New Zealand . It is not an absolute requirement. It commonly provides the widest choice of lenders, access to more favourable pricing and cashback offers, and usually avoids low-equity costs or premiums. However, depending on their circumstances, some first-home buyers may qualify with a 5%, 10% or 15% deposit.
Having the minimum deposit does not guarantee mortgage approval. Your income, debts, expenses, credit conduct, property and chosen lender must also fit.
You should not assume that you need, or will qualify with, one particular deposit percentage. Reviewing your complete position can help establish which deposit pathways may realistically be available to you.
Before deciding that you are ready to buy, or still years away, it is important to establish:
This guide is only about the deposit for a home you intend to live in. It does not explain rental-property deposit requirements. If you are buying a rental, read our investment-property deposit guide.
The deposit you need depends on the lender, your complete financial position and the home you want to buy.
| Deposit for a home you will live in | What it may mean |
|---|---|
| 20% deposit | Generally the preferred target for an owner-occupied home. It commonly provides the widest choice of lenders, access to more favourable pricing and cashback offers, and usually avoids low-equity costs or premiums. |
| 10% deposit | Some banks and lenders may consider an application, depending on their current low-deposit capacity, lending criteria, the property and the strength of your overall position. Additional interest-rate costs, fees or conditions may apply. |
| 5% deposit | A narrower pathway. Eligible first-home buyers may be able to use the Kāinga Ora First Home Loan, while limited lender-specific or family-supported options may also exist. A 5% deposit is not a market-wide promise of approval. |
A larger deposit normally reduces the amount you need to borrow. It can also provide more lender choice and a greater buffer if the lender values the property below the price you agreed to pay.
Eligible first-home buyers may be able to purchase a home they intend to live in with a 5% deposit through the Kāinga Ora First Home Loan.
Meeting the scheme’s eligibility requirements does not guarantee mortgage approval. A participating lender must still approve both the borrower and the property under its lending criteria.
The Kāinga Ora First Home Loan is not necessarily the only potential 5% pathway. Some lenders may also consider eligible first-home buyers with a 5% deposit outside the Kāinga Ora scheme. This depends on the applicant’s circumstances and the lender’s current criteria.
This may be relevant to buyers who exceed Kāinga Ora’s household-income caps or do not satisfy another scheme requirement. Five-percent lending remains more restricted than lending with a larger deposit, and availability can change.
Read our First Home Loan guide for the Kāinga Ora scheme’s eligibility requirements, possible costs and application pathway.
To calculate a deposit, multiply the intended purchase price by the deposit percentage.
For example:
| Price of the home you intend to live in | 5% deposit | 10% deposit | 20% deposit |
|---|---|---|---|
| $600,000 | $30,000 | $60,000 | $120,000 |
| $800,000 | $40,000 | $80,000 | $160,000 |
| $1,000,000 | $50,000 | $100,000 | $200,000 |
These figures show the deposit arithmetic only. They do not establish how much a lender will approve or whether a particular deposit pathway is available.
If a registered valuation is lower than the agreed purchase price, the lender will generally calculate its lending against the lower value. You may therefore need to contribute a larger deposit.
A lower valuation is not necessarily the end of the purchase, but the available response will depend on the buyer, property, contract and lender. A mortgage adviser can help assess whether any appropriate alternatives remain available.
Angela Downie, Financial Adviser at Platinum Mortgages, explains:
“A first-home buyer couple approached me with a $120,000 deposit and wanted to purchase in Hamilton. Because this represented a 20% deposit on a $600,000 property, they believed they would automatically qualify to buy at that price.
However, their deposit was not the constraint. After assessing their income and existing financial commitments, I found that their borrowing capacity supported a purchase price of around $550,000. Having the required deposit did not mean they could afford the mortgage needed for a $600,000 purchase.
Rather than applying prematurely or risking a decline, we worked together over the following six months. They repaid their credit-card debt and closed their Afterpay and Laybuy facilities. This improved their affordability, and six months later they were able to qualify comfortably for the original $600,000 purchase price they wanted.
The lesson is not to assume that having a 10% or 20% deposit automatically means you can afford a property at the corresponding price. Before beginning your property search, establish how much a lender may actually be prepared to let you borrow. Your deposit is only one part of the assessment.”
A home loan above 80% loan-to-value ratio is classified as high-LVR lending.
Under the current Reserve Bank framework, banks may allocate up to 25% of their new owner-occupier lending to loans above 80% LVR. This gives banks some capacity to approve buyers with less than a 20% deposit.
However, this is a limit across a bank’s lending portfolio—not an entitlement for an individual borrower. A bank does not have to use its entire allowance, and it may apply stricter requirements based on the borrower, property and its own lending policy.
Availability can therefore differ between lenders and change over time.
See the Reserve Bank’s current LVR restrictions.
A smaller deposit does not simply mean borrowing a larger amount. It can affect the complete lending outcome.
Depending on the lender and pathway, having less than 20% may mean:
Different lenders price and assess lower-deposit lending differently. Reaching a particular percentage does not tell you which option will provide the most suitable overall result.
The deposit a lender requires can also be affected by:
A standard residential home, apartment, lifestyle property, rural property or bare-land purchase may not receive identical treatment. Different lenders can also assess the same low-deposit application differently, and their appetite can change over time.
For a detailed explanation of possible additional costs, read our guide to low-equity margins and premiums.
Your deposit may come from more than one source, but the lender will usually need to understand where the money came from and whether any of it must be repaid.
| Possible deposit source | What needs to be established |
|---|---|
| Cash savings | The available balance, how much will remain for other purchase costs and any evidence required by the selected lender. |
| KiwiSaver first-home withdrawal | Your eligibility, expected withdrawal amount, provider’s process and whether the money will be available when required. |
| Family gift | Whether the money is genuinely non-repayable and what confirmation or documentation the lender requires. |
| Family loan | The repayment terms and how the additional obligation affects your affordability and mortgage application. |
| Inheritance | The amount available, when it will become available and any evidence or documentation required by the lender. |
A family gift, family loan and guarantee are not interchangeable. Each creates different obligations for the buyer and family member.
A family guarantee is not cash added to your deposit. It may provide additional security where the arrangement is acceptable to the lender. Because a guarantee creates legal and financial obligations for the guarantor, read our guarantor home-loan guide before anyone commits.
If you have been a KiwiSaver member for at least three years, you may be eligible to withdraw most of your savings to purchase your first home. You must generally leave $1,000 in your KiwiSaver account.
Confirm your eligibility, estimated withdrawal amount and required timeframe with your KiwiSaver provider. Your lawyer or conveyancer will also be involved in the withdrawal and purchase process.
See Inland Revenue’s current KiwiSaver first-home withdrawal information.
Financial advisers at Platinum Mortgages provide mortgage advice. They do not provide advice on selecting KiwiSaver investment products.
The word “deposit” can refer to two different amounts during a home purchase.
The purchase deposit is recorded in the sale and purchase agreement. Buyers commonly agree to pay around 10% of the purchase price, although the amount and timing depend on the agreement.
Depending on what has been agreed, it may be payable when the agreement is signed or when it becomes unconditional.
Because the sale and purchase agreement is legally binding, have your lawyer or conveyancer review it before you sign.
Your home-loan deposit is your total contribution towards the purchase price. The lender uses this amount when calculating the LVR and deciding whether the proposed mortgage fits its requirements.
For example, paying a 10% purchase deposit to the real estate agency does not necessarily mean the lender has approved a mortgage with a 10% deposit. If the lender requires a 20% total contribution, the remaining amount must still be available for settlement.
Read the government-backed Settled guidance on sale and purchase agreements and obtain legal advice before signing.
A deposit percentage is only useful when applied to a realistic purchase price. The amount shown in your savings account may not be the amount available for the purchase once KiwiSaver timing, family contributions, purchase costs and a reasonable post-settlement buffer are confirmed.
Before assuming that you need to save longer—or that you are ready to start making offers—establish:
The lender must still assess your income, debts, expenses, credit conduct and the proposed property. For those wider considerations, read our guide to mortgage lending criteria in New Zealand.
Having some deposit available does not necessarily mean that applying immediately is the right next step.
An assessment may show that you are ready to proceed now, or that waiting another three to six months could place you in a stronger position. That time might be used to improve account conduct, reduce debts, close unused credit facilities, increase savings or adjust the intended property price.
Your available savings and your usable house deposit may not be the same amount.
Depending on the property and purchase process, you may also need money for:
A larger deposit can reduce the amount you need to borrow and may improve the lending options available. However, using every dollar of your savings for the deposit can leave you financially exposed after settlement.
Where possible, Angela encourages first-home buyers to retain a cash buffer for legal fees, moving expenses, rates, insurance and unexpected property costs.
As a rough practical guide, she often suggests retaining around $5,000 where the circumstances and property allow. The appropriate amount will differ for every buyer.
Our mortgage-preparation guide explains the wider financial preparation involved before applying or making an offer.
Before relying on a deposit percentage, establish:
You do not need to approach several banks, nor ask family to commit, before understanding the likely pathways.
Platinum Mortgages can help you establish:
The practical purpose is to understand what is actually holding you back before you apply, change your property target or ask family to commit.
No. A 20% deposit is generally the preferred target for a home you intend to live in, but it is not an absolute requirement. Some buyers may qualify with a smaller deposit. The available pathway depends on the lender, buyer, property and complete application.
Potentially. Some lenders may consider a 10% owner-occupied deposit, but availability and requirements vary. Additional low-equity costs or conditions may apply.
Some first-home buyers may qualify for a pathway requiring a 5% deposit. This does not guarantee approval because the scheme or lender must still assess the borrower and property.
An eligible KiwiSaver first-home withdrawal may form part or most of your deposit. You must confirm your eligibility and available withdrawal amount with your provider, and other purchase costs may still need to be paid from separate funds.
Not necessarily. The purchase deposit is the amount and timing agreed with the seller. Your home-loan deposit is your total contribution used by the lender when calculating the LVR.
No. A larger deposit can reduce the required loan and LVR, but the lender must still assess affordability, debt, credit conduct and the proposed property.
Platinum Mortgages New Zealand Limited (FSP752271) is a Financial Advice Provider licensed and regulated by the Financial Markets Authority. Angela Downie (FSP742251) is a Financial Adviser at Platinum Mortgages who provides mortgage advice to New Zealand borrowers under that licence and has worked in the financial industry since 2006.
For first-home deposits, Angela helps buyers establish how much usable deposit they have, whether a lower-deposit pathway is realistic and which issues should be addressed before they apply or make an offer.
Read our client reviews and learn more about Platinum Mortgages’ industry recognition and awards.
This information is general only and does not take account of your individual circumstances. It is not a promise of lending approval. Lending criteria, interest rates, fees, terms and product availability can change.
