RNZ reports Kāinga Ora’s First Home Loan insurance premium will rise from 0.5% to 1.2% on applications from July 1, 2025, as the government ends its contribution under Budget 2025—saving $17.9 million annually. The scheme allows first-home buyers to purchase with just a 5% deposit, bypassing standard LVR restrictions and often avoiding low-equity fees. The premium hike means a $550,000 loan’s cost could rise from $2,750 to $6,600, either paid upfront or added to the mortgage. Though the change was poorly communicated, Jeremy Andrews of Key Mortgages says the scheme remains valuable due to one-off fees and flexible approval options.
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Kāinga Ora loan premium rises to 1.2% post July; Key Mortgages’ Jeremy Andrews says it’s still a good option for many first home buyers
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