Housing minister Phil Twyford (pictured) has set a maximum income cap for sole purchasers and couples looking to get on the ladder through the Kiwibuild scheme. Sole buyers with a salary of up to $120,000 are eligible, as are couples with a combined salary of $180,000.
The Cabinet set the criteria yesterday. Kiwibuild is hoped to be a partial solution to New Zealand's housing crisis, which has kept even wealthy first time buyers off the property ladder in heavily populated cities such as Wellington and Auckland. From today, potential buyers can register their interest online for the "affordable" homes.
The scheme has also capped prices on houses in certain cities. Homes in Auckland and Queenstown will have a maximum price of $650,000 for a three-bedroom home, $600,000 for a two-bedroom home and $500,000 for one bedroom homes. For the rest of New Zealand, the maximum price is $500,000.
The Kiwibuild programme is not open to property investors. It is only available to New Zealanders and permanent resident visa holders who intend to stay in the home for at least three years. The project is geared at first time buyers or "second chancers" looking to buy a second home after a change in financial circumstances, such as a divorce.
Kiwibuild homes may still be too costly for lower-income Aucklanders, however. A recent Auckland Council report found more than half of Aucklanders would not be able to afford one of the three-bedroom houses under the KiwiBuild scheme as they would not be able to service a mortgage for a $650,000 property.
The government plans to build 100,000 affordable homes over the next decade and has just begun work on the first properties. It is planning to build 1,000 homes in the next 12 months and ramp up construction to finish the further 9,000 by 2021.
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