Buying your first home in New Zealand can feel overwhelming - but this First Home Buyers Guide NZ breaks down the step-by-step process so you know exactly what to expect. From deposits and pre-approval through to auctions and settlement, here’s how to navigate the journey with clarity and confidence.
Getting the Foundations Right
The first step in any first home buyers journey is understanding your financial position and most buyers get this wrong.
Many assume you need a 20% deposit, but that’s not always the case.
- You can buy with as little as 5% deposit (with specific lending criteria)
- Most buyers realistically sit around 10% deposit
- 20% is ideal, but often achieved with family support or equity
Before even looking at properties, the key is knowing:
- What you can afford
- What your borrowing range looks like
- Whether you can get pre-approval
A common mistake is thinking you’re “years away” – when in reality, many buyers are closer than they think once income, KiwiSaver, and savings are assessed.
This is why speaking to a broker early is critical – it gives you clarity before you get emotionally invested.
Before You Start House Hunting
Before opening Trade Me, you need to understand what you actually want – not just what you can afford.
This part of the First Home Buyers Guide is about defining:
- Location (e.g. close to the city vs further out)
- Property type (townhouse vs standalone)
- Lifestyle factors (commute, work hours, renovation appetite)
Your first home doesn’t need to be perfect – it needs to align with your priorities.
From there, the process typically looks like:
- Get an idea of your borrowing range
- Apply for pre-approval (can take a few weeks)
- Start attending open homes while approval is processed
- Build a shortlist and get guidance on property value
Having someone experienced review properties – including past sale prices, ownership details, and potential negotiation angles – can significantly reduce risk.
Understanding Property Value and Negotiation
One of the hardest parts for first home buyers is knowing what a property is actually worth.
Real estate agents may not always give clear price guidance, which can lead to:
- Overestimating affordability
- Wasting time on unrealistic properties
- Missing out at auction
A better approach is:
- Look at comparable sales
- Check what the property last sold for
- Use online valuations as a guide – not the answer
Understanding vendor motivation can also give you an edge:
- Are they under pressure?
- Are they downsizing or moving into a retirement village?
- Do they need a quick settlement or a long one?
Negotiation isn’t just about price – it’s about structuring a deal that works for both sides.
Due Diligence: What You Must Do Before Buying
Once you’ve found the right property, due diligence is critical.
This includes:
- Building inspection (always recommended – even for new builds)
- Solicitor review (title, legal checks)
- Valuation (if required by the bank)
A key tip is to do things in the right order:
- Start with cheaper checks (e.g. building report)
- Move to more expensive steps (e.g. legal work)
- Avoid spending unnecessarily if issues arise early
The due diligence period is often fast-paced and stressful – even though the broader process can feel slow.
Buying at Auction vs Negotiation
There are two common ways to secure a property:
1. Negotiation (Conditional Offer)
- Agree on price first
- Then complete due diligence
- Less pressure, more flexibility
2. Auction
- No conditions – everything must be done upfront
- Fast-moving and competitive
- Requires a clear maximum price
Auction tips:
- Attend auctions before bidding at one
- Set a hard limit and stick to it
- Consider bidding early to stay in control
- If passed in, negotiate directly with the vendor
Going Unconditional to Settlement
Once your offer is accepted and conditions are met:
- You go unconditional
- Pay the deposit (typically 10%, but negotiable)
- Move into the settlement period (usually ~10 working days minimum)
During this time:
- Finalise lending structure (rates, repayments, loan setup)
- Complete AML and bank onboarding
- Sign loan documents through your solicitor
You’ll also need:
- House insurance (required by the bank)
- Consideration of personal risk cover (income protection, life insurance)
Key Takeaways
- You don’t always need a 20% deposit- many buyers purchase with 5-10%
- Start with affordability and pre-approval before house hunting
- Define what you want in a property before looking
- Property value isn’t always clear – use comparable sales and expert input
- Due diligence is essential – especially building inspections
- Auctions move fast – always set a hard limit
- Negotiation isn’t just about price – terms matter
- Settlement involves legal, banking, and insurance steps
- Having the right team around you reduces risk and stress
Next Steps:
If you’re thinking about buying your first home, speak to the Lighthouse Mortgage team – we’ll help you understand your position and guide you through the process.
If you’d like to watch more, check out this other episode below.
For a no obligation discussion to see how we can help you on the path to wealth, please contact us.
Disclaimer:
The information in this article is general information only, is provided free of charge and does not constitute professional advice. We try to keep the information up to date. However, to the fullest extent permitted by law, we disclaim all warranties, express or implied, in relation to this article – including (without limitation) warranties as to accuracy, completeness and fitness for any particular purpose. Please seek independent advice before acting on any information in this article.
