Rent-to-own scheme a game-changer - Habitat for Humanity homeowner

The planned shared ownership schemes mean thousands of families won't need to save as much for a deposit - and once in a home, their repayments won't be as high.

Joseph Fa'afiu says his experience of rent-to-own with Habitat for Humanity was a game-changer five years ago, when saving for a house deposit was impossible. 

"It's awesome to know that you're not paying someone else's mortgage - you are paying towards something you can own at the end of the day," he says.

Now he's working towards ownership of his family home, and around 2500 more Kiwis will get the same opportunity through what the Government is calling progressive ownership. 

There are various kinds of these schemes.

One is shared equity, where you would have a smaller mortgage so that you own part of a home and a third party, like Habitat for Humanity or the Government, owns the rest. 

Over time you could buy further chunks of the mortgage until you own the whole thing. 

Another option is that you start off paying rent to a third party - but it's heavily discounted so you can save up for a deposit and then eventually buy it outright. 

Habitat for Humanity is one of several organisations that will implement the Government's fund of $400 million for the programme, but nothing is yet set in concrete. 

"I think what we're seeing is a realisation that the devil is in the detail when it comes to housing programmes, so I think the Government will and should take its time to get the details right," says Habitat for Humanity's chief executive Claire Szabo.

Housing Minister Megan Woods says those details will be ironed out later this year.

"I'm looking to take the final design features of that to Cabinet by the end of this year - we're looking to have that in place next year," she says.

What is confirmed is the deposit needed for a first-home grant drops from 10 to five percent. 

And previously, a multi-generation family living in the same house would only be able to get a maximum of two home start grants at $10,000 each.  Now each earner would be able to get a home start grant so that rises up to $40,000 in total. 

It's all part of a progressive ownership reset, but some parts are still very much a work in progress. 


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