Lukewarm response to home loan top-ups

Only $1.6 million of the Government's allocated $18.4 million to help modest income-earners buy houses in expensive places has been taken up.

New Zealanders roundly rejected the idea of getting free financial top-ups via the state and the shared equity pilot scheme resulted in a 1033 per cent under-demand.

Details of the scheme are in Housing NZ Corporation's just-released annual report for the year to June 30, 2009.

Those earning $85,000 but needing 5 per cent to 30 per cent extra cash to buy or build their first home in high-priced Auckland, Wellington, Nelson, Christchurch or Queenstown could get the money.

The two-year pilot offered an interest-free top-up loan from Housing NZ. No regular repayments were even required if 20 per cent was loaned.

The scheme was hatched by the Labour Government in response to the housing affordability crisis.

Michelle Williams, Housing NZ senior communications adviser, said the government change meant the scheme was not actively promoted.

To read the full NZ Herald article, click here

Posted: 4 Nov 2009

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