In a country where home ownership has quietly slipped from a generational expectation to an increasingly distant aspiration, New Zealand's National Party is proposing to widen the door to a scheme that has helped tens of thousands of households cross the threshold into ownership. By tripling the income cap for the First Home Loan scheme — from $150,000 to $300,000 — the party argues that the program has fallen out of step with the realities of modern earnings, leaving junior doctors, dual-income couples, and young professionals stranded between earning enough to service a mortgage and saving e
National pledges to triple income cap for first-home buyer deposit scheme
Half of first-home buyers now earn more than the scheme allows
Mark
So National is saying the income caps haven't moved since 2022. Why does that matter if incomes have actually grown?
Mimi
Because the scheme was designed to help people who couldn't save a deposit. If you earn $160,000 now but couldn't access the scheme five years ago when you earned less, you've aged out. The caps didn't move with the economy.
Luke
But here's the thing—we don't actually know how many people are being excluded. National gives us examples: a junior doctor, a couple with mixed incomes. Those are real cases. But they haven't released data showing how many applicants are rejected for exceeding the cap versus how many simply don't apply because they think they're ineligible.
Mimi
Fair point. But the median first-home buyer income is $146,000. That's a concrete number. It means half the market is above the current $150,000 cap for couples.
Luke
Half the market, or half the people who successfully bought? Those are different groups. We don't know the income distribution of people who tried to use the scheme and were rejected.
Mark
What about the cost? Four to six million a year seems low.
Mimi
It is low, relatively. But National is betting that doubling the scheme's size—from roughly 7,700 approvals a year to 15,000—will happen at that cost. That's an assumption.
Luke
Right. They're projecting that doubling participation will only cost four to six million extra. That means they're assuming the per-loan cost stays the same. But if you're bringing in higher-income borrowers, the loan sizes might be bigger, which could change the risk profile and the cost to the Crown.
Mark
So the policy could cost more than they're saying?
Luke
Possibly. Or it could cost less if uptake is slower than projected. The point is, the cost estimate depends on assumptions about behavior that we can't verify yet.
Mimi
But the core idea is sound—if you earn a solid income but haven't had time to save, this removes a real barrier. That's not speculative.
Mark
And the broader goal is to get home ownership back to 74 percent?
Mimi
That's the vision. Currently at 66 percent. This is one tool among several—supply reforms, KiwiSaver changes, other policies.
Luke
Which means this policy alone won't move the needle much. Home ownership depends on deposit size, property prices, lending standards, and employment stability. Raising an income cap helps, but it's not the whole picture.
The Pulse
- Home ownership in New Zealand has fallen from 74% to 66%, and the income thresholds governing access to low-deposit mortgages have not moved since 2022 — leaving a growing share of working professionals locked out of a scheme designed for them.
- A junior doctor on $100,000, a teacher-and-electrician couple earning $163,000 combined, two newly graduated police officers — all currently ineligible, all unable to save a 20% deposit while meeting the costs of modern life.
- National proposes collapsing the single-versus-couple distinction and setting one unified income cap of $300,000, a change it estimates will double annual scheme participation by drawing in roughly 7,700 additional applicants.
- The fiscal outlay is deliberately contained — $4 to $6 million per year, drawn from existing baselines — framing this as a precision intervention rather than a broad spending commitment.
- The policy lands as one piece of a larger National platform pairing supply-side housing reform with targeted demand-side support, all oriented toward the goal of restoring home ownership to its early-2000s peak.
- Whether higher-earning professionals will actually flood into the scheme, or whether deposit size and property prices will remain the binding constraint, is the question the policy leaves unanswered.
In a country where home ownership has quietly slipped from a generational expectation to an increasingly distant aspiration, New Zealand's National Party is proposing to widen the door to a scheme that has helped tens of thousands of households cross the threshold into ownership. By tripling the income cap for the First Home Loan scheme — from $150,000 to $300,000 — the party argues that the program has fallen out of step with the realities of modern earnings, leaving junior doctors, dual-income couples, and young professionals stranded between earning enough to service a mortgage and saving enough to begin one. The pledge is modest in cost but pointed in ambition: to reverse a two-decade slide in home ownership and give younger New Zealanders a reason to stay and build their lives here.
New Zealand's National Party has pledged to overhaul the income thresholds governing the First Home Loan scheme, proposing to triple the cap from $150,000 to $300,000 if it wins the next election. The scheme, which has operated in various forms since 2003 and is currently administered through Kāinga Ora, allows eligible buyers to access mortgages with deposits as low as 5% — a meaningful advantage in a market where saving the standard 20% has become increasingly out of reach.
The case for change rests on a straightforward observation: the thresholds have not moved since 2022, while incomes and living costs have. A single buyer cannot currently earn more than $95,000; couples or single parents are capped at $150,000. National points out that the median gross income of first-home buyers now sits around $146,000, meaning roughly half of all buyers in this category already earn above the couple's cap. The scheme, in other words, has drifted away from the people it was built to serve.
The party illustrates the gap with specific examples — a junior doctor on $100,000, a teacher and an electrician together earning $163,000, two police college graduates each on $77,000 — all ineligible, all struggling to accumulate a deposit while managing rent, food, and childcare. National's proposal would remove the distinction between single and multiple borrowers entirely, replacing the tiered system with a single $300,000 threshold.
The scheme has already helped more than 33,000 households into ownership. National estimates the change would double annual participation, adding roughly 7,700 applicants per year at a Crown cost of $4 to $6 million annually — a figure the party says can be absorbed within existing baselines. Set against the scale of New Zealand's housing challenge, it is a deliberately narrow lever: expand eligibility, and let the market respond.
The pledge fits within National's broader housing agenda, which pairs supply-side reforms — zoning liberalisation, faster consenting, infrastructure investment — with targeted support for younger buyers. The party's stated ambition is to return home ownership to 74%, the peak recorded in the early 2000s, from its current 66%. Whether raising income caps alone will close that gap, or whether deposit requirements and property prices will continue to constrain access regardless of eligibility, remains the central uncertainty the policy does not yet resolve.
The National Party is moving to remake access to one of New Zealand's longest-running first-home buyer support programs. The party has pledged to triple the income cap for the First Home Loan scheme—raising it from $150,000 to $300,000—if it wins the next election, a change it argues will unlock mortgages for thousands of young professionals currently locked out despite earning solid incomes.
The scheme itself is not new. It has operated since 2003 under various names, most recently as the First Home Loan scheme administered through Kāinga Ora. It allows eligible buyers to access mortgages with deposits as low as 5%, a significant advantage in a market where saving 20% has become nearly impossible for many. But the income thresholds have remained static since 2022. Currently, a single buyer with no dependents cannot earn more than $95,000 annually. For couples or single parents, the cap sits at $150,000. Those limits, National argues, no longer reflect the reality of New Zealand's workforce.
The party's case rests on concrete examples. A junior doctor earning $100,000 is currently ineligible. A young couple—an electrician on $85,000 and a teacher on $78,000—cannot access the scheme despite their combined income of $163,000. Two friends fresh from police college, each earning $77,000, are shut out. These are not low earners. Yet they struggle to accumulate a deposit while paying rent, feeding themselves, and managing childcare. National points out that the median gross income of first-home buyers now sits around $146,000, meaning roughly half of all first-home buyers earn above that figure. The $150,000 cap, in other words, excludes a significant portion of the market it was designed to serve.
National's proposal would eliminate the distinction between single and multiple borrowers, creating a single $300,000 income threshold for anyone seeking a 5% deposit loan. The party estimates this change will double the scheme's size, bringing in roughly 7,700 additional applicants annually based on recent uptake patterns. Between July 2025 and April 2026, the scheme approved more than 7,700 applications. Over its entire history, it has helped more than 33,000 households into ownership. Doubling that flow would represent a significant expansion of the program's reach.
The fiscal cost is modest by government standards. National estimates the policy will require $4 to $6 million in additional Crown spending each year, or $16 to $32 million over the four-year forecast period. The party says this will come from existing baselines—no new money, no new taxes. For context, that is a fraction of what governments typically spend on housing interventions, yet it targets a specific pain point: the gap between earning enough to qualify for a mortgage in principle and earning enough to save the deposit required to access it.
The pledge sits within a broader National agenda on housing and economic policy. The party has championed supply-side reforms—zoning changes, streamlined consenting, and infrastructure investment—that it credits with accelerating housing construction. Now it wants to pair those supply measures with demand-side support, specifically targeting younger New Zealanders. National's stated goal is to return home ownership rates to 74%, the peak achieved in the early 2000s. The current rate stands at 66%. The party frames the First Home Loan expansion as one piece of a wider package aimed at helping young people stay in New Zealand and build wealth through property ownership, alongside policies on KiwiSaver, parental leave, rates caps, and student loan repayment rates.
What remains to be tested is whether raising income caps alone will move the needle significantly. The scheme's current users earn less than the proposed cap, suggesting demand exists at lower income levels. Whether tripling the cap will draw in the higher-earning professionals National has identified, or whether other barriers—deposit size, property prices, lending standards—will still constrain access, is an open question. The policy is a straightforward lever: raise the threshold, expand eligibility, and let the market respond. Whether that response will match National's projection of doubled participation will depend on factors beyond the party's control.
Notable Quotes
The scheme's current income caps are too restrictive and haven't been updated since 2022. A junior doctor on $100,000 can't access the scheme. Nor can a young couple, like an electrician on $85,000 and a teacher on $78,000.— National Party spokesperson Bishop
While a combined income of $150,000 might sound like a lot of money, the reality is that plenty of young couples now earn more than that but still struggle to save for a 20% deposit while juggling the cost of rent, food, and childcare.— National Party spokesperson Bishop
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