Using KiwiSaver for Land Purchase

Using KiwiSaver for land purchase is possible, but the rules are more specific than for buying an existing home. You cannot simply buy any land and access your KiwiSaver. Understanding the requirements helps you plan effectively if you want to build.

Land purchases must be part of a genuine intention to build and live in a home on that land.

The Basic Rule

You can withdraw KiwiSaver for land purchase if you intend to build a home on that land and live in it as your principal residence. The land purchase must be directly connected to creating your first home.

Buying land as an investment, for future subdivision, or without immediate building plans does not qualify for KiwiSaver withdrawal.

The intention to build and occupy must be genuine and demonstrable at the time you apply for withdrawal.

Evidence Of Building Intention

When applying for KiwiSaver withdrawal for land, you will need to provide evidence that you plan to build. This typically includes building consent documentation or contracts with builders.

A signed building contract helps establish that you are genuinely planning to construct a home rather than holding land speculatively.

Pre-approval for a construction loan also demonstrates intent and provides additional evidence of your plans.

Timing Of Withdrawal

You can apply for KiwiSaver withdrawal when purchasing land, not just when construction begins. The withdrawal can contribute to your land deposit.

However, you need the evidence of building intention at the time of the land purchase application. Simply buying land hoping to build someday is insufficient.

Your provider will assess whether your plans demonstrate genuine first home purposes before approving withdrawal.

House And Land Packages

Purchasing a house and land package simplifies the process. These packages clearly demonstrate your intention to build because construction is part of the single transaction.

KiwiSaver withdrawal applies straightforwardly to house and land packages. The evidence of building intention is inherent in the purchase structure.

Buying Land Then Building Later

If you buy land first and build later, timing becomes more complex. You can use KiwiSaver for the land purchase if you have building plans at that time.

You cannot use KiwiSaver twice: once for land and again for the house. Your withdrawal for the land is your first home withdrawal.

Plan your finances carefully if separating land and construction. Ensure you have funding for both stages without relying on a second KiwiSaver withdrawal.

Rural And Lifestyle Blocks

Larger rural properties and lifestyle blocks may qualify if you intend to build and live there. The purpose test remains the same.

Properties with existing dwellings may or may not qualify depending on your plans. If buying land with an old house you intend to demolish and rebuild, discuss with your provider.

Agricultural or commercial purposes do not qualify. The property must be for residential purposes as your principal residence.

Subdivision Situations

Land that is part of a subdivision being developed often qualifies. New sections with services connected and building platforms ready are typically straightforward.

Buying land with the intention of subdividing it yourself for profit does not qualify. This is investment activity, not first home purchase.

If you buy a larger section intending to later subdivide and sell part, discuss with your provider whether this affects eligibility.

Working With Your Provider

Each KiwiSaver provider may interpret land purchase rules slightly differently. Contact your provider early to understand their specific requirements.

Provide comprehensive documentation of your building plans. The more evidence of genuine first home intention, the smoother the approval process.

If your situation is complex, seek advice before committing to a land purchase. Understanding eligibility beforehand prevents disappointment.