KiwiSaver Generation Takes Over NZ Housing Market
According to Reserve Bank data, almost $9 out of every $10 extra dollars banks lent in mortgages last year went to first-home buyers.
In the year to June, first-home buyers borrowed about $20 billion and were responsible for 87% of the increase in net new mortgage debt.
This surge is largely due to KiwiSaver, which has become a key factor in helping people buy their first home.
Chief economist Shamubeel Eaqub says that KiwiSaver has come of age and is no longer just seen as a retirement savings product.
In the last decade, there have been 400,000 first-home withdrawals from KiwiSaver, averaging about 40,000 homes per year.
The average withdrawal amount has more than doubled from $20,000 to almost $45,000 in the same period.
Eaqub attributes this growth to consistent saving and automatic contributions, which have enabled many young people to accumulate wealth.
He notes that many first-home buyers are no longer a small group at the edge of the market but are now making up 42% of all house sales, up from 25% a decade ago.