Helen Twose: Sisterly love buys a home

As long as you qualify, you can buy a shared house using your KiwiSaver deposit. Photo / Getty Images

Q: I have been granted access to my funds to buy a home. Can I buy with my sister who is putting in half the deposit? Both our names will be on the sale and purchase agreement.

A: Congratulations on ticking all the boxes for a first-home withdrawal.

Anyone who has been a KiwiSaver member for at least three years and hasn't previously owned a home may be able to withdraw nearly all, or part of, their savings to put towards a first home.

The funds available include your contributions, any employer contributions, member tax credits and any investment earnings.

The final $1000 will need to remain in your KiwiSaver account and you can't withdraw any money you've transferred from an Australian superannuation fund.

You must also plan to live in the home you buy.

Amanda Morrall of KiwiSaver provider Simplicity says if you qualify for a first-time home withdrawal on your funds, nothing should prevent you buying a home with your sister.

If she qualifies as well you can both use your funds for the purchase.

"Additionally, you might be able to qualify for the HomeStart grant, which could give you as much as $10,000 combined ($1000 for every year invested in KiwiSaver up to $5000)," says Morrall.

The grant is for individuals earning $85,000 or less or two people making $130,000 combined.

The HomeStart grant, which is administered by Housing New Zealand, is aimed at people planning to buy a modestly priced home, ranging from $650,000 in Auckland, $550,000 in other popular housing markets and $450,000 in the rest of the country.

You will also need to have consistently contributed minimum amounts to your KiwiSaver account for three years and have saved a 10 per cent deposit.

The deposit can include money withdrawn from your fund, the HomeStart grant if you are eligible and any savings.

Additional conditions unique to the HomeStart grant are at the Housing New Zealand website: tinyurl.com/zczxfpj

Morrall recommends you check with your provider about the timing of the release of your funds.

"A few people have expected to have that money at hand for a deposit on a house to secure the initial offer then been disappointed not to receive it right away.

"Typically, KiwiSaver funds aren't released until the house sale has gone unconditional, at which time the money goes to your solicitor for the settlement process," she says.

The funds are paid into your solicitor's trust account in order to settle the purchase.

If the house sale fails to go through your solicitor will repay the money to your provider.