Q: Our son decided he would like to have a house, but he hadn't saved very much money. "Bank of Mum and Dad" paid for the house and relieved him of the savings he had. At this time, he did not belong to KiwiSaver. He and his mother were registered as equal owners. As time went on, he inherited a sum of money, which he used to repay his half of the cost of the house. He has now been in KiwiSaver for more than five years and has a healthy balance. He has repaid his half of the purchase price and is repaying us the other half so he can become the sole owner. We have not put the house in his name entirely yet as a protection. Can he access the funds he has in KiwiSaver as a first-home buyer?
Your son has been very lucky to have your financial help. With your backing it sounds like he is well on his way to paying off his first home and he has also built up savings in KiwiSaver along the way.
So can he use those KiwiSaver funds to buy out the share of the home owned by his mother?
I put it to Therese Singleton, general manager, investments and insurance at AMP, who says anyone wanting to withdraw funds from their KiwiSaver for a first home needs to have been in KiwiSaver for at least three years, which your son has done.
One of the benefits of KiwiSaver is people wanting to get into their first home can use virtually all their KiwiSaver funds - only $1000 needs to stay in the account - to buy or build a house, once they have clicked over that three-year anniversary.