Larger KiwiSaver First Home Withdrawals will be allowed by including the member's tax credit and Welcome Home Loans will align house price caps with the new KiwiSaver HomeStart Grant.
The KiwiSaver HomeStart grant will double to $6000 after three years, $8000 after four years and $10,000 after five years for the purchase of a newly-built home.
Property Brokers Hawke's Bay manager Paul Whitaker said the market was entering "exciting times ahead" thanks to the changes.
"There will be a bigger choice for first-home buyers - up to $350,000 - and the government is making greater contributions," he said.
Mr Tremain said the rule changes would negate Reserve Bank restrictions on how many low deposit loans banks make.
The loan to value (LVR) restrictions were blamed for stalling markets outside of Auckland as the Reserve Bank tried to rein in inflation-fuelling record house prices in Auckland.
Napier MP Stuart Nash said the first-home changes were welcome but LVRs were still a barrier to home ownership and prevented existing home owners from upgrading to accommodate a larger family.
"Often young couples need $40,000 for a $200,000 home and there ain't too many homes in Napier you can get for $200,000 nowadays," he said.
Ikaroa Rawhiti MP Meka Whaitiri said LVR restrictions hurt Hawke's Bay people "desperate to experience the Kiwi dream of home ownership".
"Why punish hard-working Kiwis who choose to live in the provinces, when it is the Auckland housing market causing all the problems?" she said.
"Labour would encourage the Government to provide firm direction to the Reserve Bank that LVRs are hurting those in the provinces and they should be far more targeted towards Auckland."
Tukituki MP Craig Foss said Reserve Bank monetary policy was independent.
"If the Reserve Bank didn't put LVRs in place they would be doing something else, such as raising interest rates for everybody," he said.
Only applying LVRs to regions wasn't practicable, he said.
An "army of clipboard people" would be needed to implement the policy, leaving the "core problem" of supply and demand unaddressed.
"We are one country and we have similar benefits and challenges of having a very large and growing city such as Auckland."
Reserve Bank Deputy Governor Grant Spencer said many regions had a flat real estate market in contrast to Auckland.
Auckland was one third of the country so it had "quite an influence".
Its house prices were higher, so the deposit restrictions affected a bigger portion of buyers.
Hawke's Bay's market was affected "but that is the nature of such policies".
While the local market was flat there was nothing wrong with a stable property market and while first home buyers were fewer but the number was not significant, he said.
Many first home buyers were targeting new houses, for which there were no deposit restrictions.
"We need more new houses."
