KiwiSaver volatility impacts first-home deposits
First-home buyers in New Zealand are facing real-world consequences as their KiwiSaver balances, often a crucial part of their home deposits, take a hit due to global economic instability.
A combination of international trade tensions and stock market downturns is complicating the path to homeownership, even as interest rates fall and house prices remain relatively low.
Wellington buyer Mikaela Venimore experienced this firsthand. After six months of house hunting, she placed an offer on a property—only to see her KiwiSaver balance drop by 10%, Stuff reported.
At its peak in February, Venimore’s fund had gained 14%, but by the time of her offer, that return had diminished to just 5%.
Despite the dip, she remained optimistic.
“I do think Trump is being quite silly starting a trade war, but hopefully he quits soon so we can go back to normality,” Venimore said.
Timing the market adds pressure for buyers
Thomas Baker, who purchased his home in March, also felt the financial sting.
Baker’s KiwiSaver—built up over eight years—fell by around 4–5%, shrinking the amount he had available for a deposit.
“It definitely felt like there was pressure to purchase, as all the commentary was that house prices were low and this was a good time to enter the market, especially with interest rates coming down,” he said.
“It made it more difficult that this coincided with such a significant drop in share values which changed the value of the deposit available.”
Advisors urge early KiwiSaver checks
Experts said that first-home buyers need to think strategically about their KiwiSaver settings as early as possible, Stuff reported.
Elyce Peters, head advisor at The Mortgage Girls, recommends prospective buyers speak to their provider in advance.
“It’s really important they are in the correct fund in regards to risk—especially if they’re planning to use their KiwiSaver soon,” Peters said.
Squirrel mortgage adviser Adam Clark echoed the sentiment, urging buyers to “control your controllables.”
Clark advised that in times of uncertainty, buyers should consider moving to conservative or cash funds depending on how soon they plan to buy. However, he cautioned against switching too quickly and locking in losses.
Experts recommend a risk-aware strategy
Rupert Carlyon (pictured), managing director of Kōura Wealth, advised caution for buyers relying heavily on KiwiSaver as a deposit source.
“Find a fixed interest or cash fund and let it sit there,” Carlyon said. “You might forgo the recovery, though at the very least you have capped your downside and know exactly what you can afford for that first home.”
For long-term retirement savings, however, he recommends a different approach.
“Truth is people should not be taking their money out for a long time... So, my suggestion to them would be stay the course,” Carlyon said.
First-home buyers still active despite uncertainty
Despite KiwiSaver fluctuations, many first-home buyers remain active in the market, supported by low interest rates and stable property prices. According to CoreLogic, first-home buyers made up 26.1% of all property sales in 2024.
With the right guidance and fund selection, experts say the path to homeownership remains viable—even in a volatile global environment.
