How much deposit you need to buy a house in New Zealand, and the low-deposit options
Financial advice is provided by Craig Smith Business Services Limited, trading as Smiths Insurance & KiwiSaver, a licensed Financial Advice Provider (FSP712931). QuoteHub is a trading name.
Most New Zealand lenders require a 20% deposit for a standard home loan, which is $100,000 on a $500,000 house; the Reserve Bank limits how much lending banks can do above that threshold, and Kāinga Ora's First Home Loan can lower an eligible first buyer's deposit to 5%, or $25,000 on the same purchase (Reserve Bank of New Zealand, Loan-to-value ratio restrictions, retrieved 9 September 2026; Kāinga Ora, First Home Loan, retrieved 9 September 2026).
Once your deposit is sorted, mortgage pre-approval in NZ is usually the next step, and our buying-a-house checklist hub sets out the full sequence.
The standard deposit rule
Do you need a 20% deposit to buy a house?
Not strictly always, but 20% is the level most home loan lenders work to, because the Reserve Bank's loan-to-value ratio (LVR) restrictions classify a loan as "high-LVR" once it is above 80% of the property's value, and limit how much of that riskier lending a bank can do overall (Reserve Bank of New Zealand, Loan-to-value ratio restrictions, retrieved 9 September 2026). From 1 December 2025, banks can allow up to 25% of new owner-occupier lending to sit above that 80% threshold, up from 20% previously, giving banks somewhat more flexibility to lend to buyers with a smaller deposit (Reserve Bank of New Zealand, Reserve Bank to ease LVR restrictions, retrieved 9 September 2026).
How much deposit do I need for a $500,000 house?
At the standard 20% deposit, a $500,000 house needs a $100,000 deposit; at a 5% deposit under the First Home Loan, the same house needs $25,000, provided you meet Kāinga Ora's eligibility criteria (Kāinga Ora, First Home Loan, retrieved 9 September 2026). The table below shows the deposit required at several common percentages.
| Deposit percentage | Deposit on a $500,000 house | Deposit on a $700,000 house |
|---|---|---|
| 20% (standard) | $100,000 | $140,000 |
| 10% | $50,000 | $70,000 |
| 5% (First Home Loan only, if eligible) | $25,000 | $35,000 |
(QuoteHub calculation from the published percentages; see Reserve Bank of New Zealand and Kāinga Ora sources above, retrieved 9 September 2026.)
Can I buy a house in New Zealand with only a 10% deposit?
It is possible, since the LVR restrictions allow a portion of a bank's lending to sit above 80% LVR, but it is not guaranteed: a 10% deposit puts you in the higher-risk "speed limit" pool banks can only extend to a capped share of borrowers, so approval depends on your individual serviceability and the specific bank's current appetite for high-LVR lending at the time you apply (Reserve Bank of New Zealand, Loan-to-value ratio restrictions, retrieved 9 September 2026). This is different from the First Home Loan, which sits outside the LVR restrictions entirely because Kāinga Ora exempts it.
The First Home Loan: the main 5%-deposit route
What is the minimum deposit for a first home loan in NZ?
Kāinga Ora's First Home Loan lowers the required deposit to 5% of the purchase price, inclusive of all savings, gifts and any other funds you contribute, because Kāinga Ora underwrites part of the risk so a participating bank can lend at a level it otherwise could not (Kāinga Ora, First Home Loan, retrieved 9 September 2026). You must also meet income caps and other eligibility rules on top of the deposit itself.
What low-deposit home loan options are available in NZ?
The First Home Loan is the main government-backed low-deposit route, available through a small panel of participating banks and lenders, and it sits outside the Reserve Bank's LVR restrictions entirely, alongside other exemptions such as construction loans and portability of an existing loan (Reserve Bank of New Zealand, Loan-to-value ratio restrictions, retrieved 9 September 2026). Outside the First Home Loan, a lender may still choose to approve a below-20% deposit loan within its own capped high-LVR allowance, but this is a bank-by-bank decision rather than a guaranteed product.
The table below sets out the First Home Loan's core eligibility criteria.
| Criterion | Requirement |
|---|---|
| Deposit | At least 5% of the purchase price |
| Income cap, individual, no dependants | $95,000 or less (before tax, last 12 months) |
| Income cap, individual with dependants, or 2+ buyers combined | $150,000 or less (before tax, last 12 months) |
| Property | Under 1 hectare, your primary residence, no other property owned |
| Lender's Mortgage Insurance premium | 1.2% of the loan amount, paid upfront or added to the loan |
(Kāinga Ora, First Home Loan, retrieved 9 September 2026.)
Is a First Home Loan a type of mortgage insurance for me?
No. The First Home Loan's 1.2% premium is a form of Lender's Mortgage Insurance, which protects the lender if your loan repayments default; it is a different product from mortgage protection insurance, which protects you and your family's ability to keep making repayments if your income stops (Kāinga Ora, First Home Loan, retrieved 9 September 2026). Our mortgage protection guide, mortgage protection overview and the mortgage protection insurance calculator cover that separate, borrower-side product.
What's the difference between a "vendor" deposit and a "financial" deposit?
A financial deposit is the amount you personally contribute toward the purchase price, the figure this page is about; a vendor deposit is a separate amount the seller may ask for to secure the property before settlement, typically held by the real estate agent in trust until settlement, and is a different concept from your loan deposit entirely (Kāinga Ora, First Home Loan, retrieved 9 September 2026). Our sale and purchase agreement guide covers how a vendor deposit is typically set out in the agreement itself, alongside insurance on settlement day, which covers what has to be in place once the deal goes unconditional.
What else affects how much you can borrow
How much do you have to earn to qualify for a $200,000 mortgage?
There is no single published income figure, because a $200,000 mortgage is small enough that debt-to-income (DTI) restrictions are unlikely to be the binding limit for most buyers; the Reserve Bank's DTI rule instead caps how much you can borrow relative to income, at up to 6 times your gross annual income minus existing debt for an owner-occupier (Reserve Bank of New Zealand, Understanding debt-to-income (DTI) restrictions, retrieved 9 September 2026). At that ratio, a $200,000 loan with no other debt would need only around $33,300 of gross income to stay within the DTI cap, so in practice a bank's own serviceability and affordability assessment, not DTI, is what actually determines whether you qualify.
How does the debt-to-income rule actually work?
The Reserve Bank's worked example shows a household borrowing $800,000 with $27,000 of existing debt and $135,000 of combined gross income: their DTI ratio is ($27,000 + $800,000) ÷ $135,000 = 6.13, calculated against a threshold of 6 for an owner-occupier, meaning that borrowing is considered high-DTI and subject to the bank's capped "speed limit" for this kind of lending (Reserve Bank of New Zealand, Understanding debt-to-income (DTI) restrictions, retrieved 9 September 2026). DTI restrictions came into effect on 1 July 2024 and apply on top of, not instead of, the LVR deposit rules above.
Does the deposit rule change for an investment property?
Yes, in the opposite direction to what many buyers expect on income: the DTI threshold for an investor is higher, at up to 7 times gross income, but LVR restrictions are tighter, classifying investor lending as high-LVR above 70% of the property's value rather than 80%, with a smaller share of a bank's investor lending permitted above that line (Reserve Bank of New Zealand, Loan-to-value ratio restrictions, retrieved 9 September 2026). This page covers an owner-occupier's own home deposit; an investment purchase runs on these separate settings.
The table below contrasts the owner-occupier and investor settings side by side.
| Setting | Owner-occupier | Investor |
|---|---|---|
| LVR high-risk threshold | Above 80% of property value | Above 70% of property value |
| Share of a bank's new lending allowed above that threshold | Up to 25% (from 1 December 2025) | Up to 10% |
| DTI high-risk threshold | Above 6 times gross income minus debt | Above 7 times gross income minus debt |
| Kāinga Ora First Home Loan available | Yes, if eligible | No |
(Reserve Bank of New Zealand, Loan-to-value ratio restrictions and Understanding debt-to-income (DTI) restrictions, retrieved 9 September 2026.)
What debts count against me in the DTI calculation?
The Reserve Bank's worked examples show existing debt is counted broadly: student loans, car loans and the full limit of a credit card (not just the outstanding balance) all count, while an interest-free loan from family with no fixed repayment date, a business loan secured over stock, and a bridging loan expected to be repaid on the sale of another property are typically excluded from the calculation (Reserve Bank of New Zealand, Understanding debt-to-income (DTI) restrictions, retrieved 9 September 2026). Exactly what a specific bank counts can still vary, since DTI is one input among several in its own lending decision.
Grants that used to exist
Is the First Home Grant still available?
No. The First Home Grant, a scheme that paid up to $5,000 (or $10,000 for a new build) to help eligible buyers with a deposit, was closed with immediate effect on 22 May 2024, with the government redirecting the funding to social housing instead (Beehive.govt.nz, First Home Grant closure exemptions, retrieved 9 September 2026). A narrow exemption was later added only for buyers who already had a signed sale and purchase agreement or an expired pre-approval from before the closure date; it is not available to new applicants.
Where this fits with the rest of the buying process
Working out your deposit is usually the first practical step before mortgage pre-approval in NZ, which confirms what a lender will actually offer once your deposit and income are assessed together. From there, a registered valuation may confirm the property supports the loan, the sale and purchase agreement records the price and conditions, and a pre-purchase building inspection and the council rating valuation sit alongside the finance steps rather than replacing them. Our buying-a-house checklist hub sets out the full order.
QuoteHub built this page because "how much deposit" is usually really two questions, what percentage a lender needs and whether you can actually service the loan once you clear it, and conflating the two leads buyers to save for the wrong target. Financial advice is provided by Craig Smith Business Services Limited, trading as Smiths Insurance & KiwiSaver, a licensed Financial Advice Provider (FSP712931). QuoteHub is a trading name. Once your deposit and finance are close to sorted, protecting the loan itself becomes the next decision, and our guides to insurance for first-home buyers, first-home buyer insurance in New Zealand, life insurance with a home loan, life insurance for mortgage holders and our mortgage protection guide cover that separate decision, with a licensed adviser available to talk it through.
Adviser's view
The number QuoteHub sees people fixate on is the deposit percentage, when the actual constraint that stops most applications is serviceability, whether the bank believes your income can carry the loan, not whether you cleared a specific deposit line. A smaller deposit is achievable through the First Home Loan; a bank unconvinced you can service the repayments is a separate problem entirely.
Check what your mortgage repayments would need · free, no obligation.
Cite this page QuoteHub NZ (2026). How Much Deposit Do You Need to Buy a House NZ?. www.quotehub.co.nz/guides/buying-a-house/house-deposit-nz. Updated 2026-09-09.
References
- Reserve Bank of New Zealand: Loan-to-value ratio restrictions
- Reserve Bank of New Zealand: Reserve Bank to ease LVR restrictions
- Reserve Bank of New Zealand: Understanding debt-to-income (DTI) restrictions
- Kāinga Ora: First Home Loan
- Beehive.govt.nz: First Home Grant closure exemptions
Explore related pages: Life Insurance, Income Protection, Health Insurance, Trauma Insurance, For Brokers.