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BNZ starts shared ownership scheme

BNZ is looking to lure first home buyers with a new shared ownership scheme, the first of its kind in New Zealand. 

Monday, December 10th 2018, 11:38AM 1 Comment

Paul Carter

The scheme, announced today by BNZ chief customer officer Paul Carter, will see the bank partner up with a home finance company to help first home buyers get on the property ladder. 

Shared ownership schemes see finance companies partner with buyers, with the homeowner gradually taking full ownership over a series of years. Occupiers usually take a 10% equity slice to begin with, while the third party takes another 10%. The schemes have been successful in global cities with expensive property prices, including London. BNZ's model will be for new-build homes only. 

BNZ says it has launched the scheme to help buyers who can't rely on the "Bank of Mum and Dad" -- an increasingly popular source of deposit financing. BNZ's Carter said: "Some New Zealanders are lucky enough to have mums and dads topping up their savings, so they can get the deposit to buy a house. Not everyone has family to call on in this way and that’s where shared ownership could help."

Shared ownership schemes have been popular in Europe for years, and some social housing schemes in New Zealand offer similar funding models. Yet the BNZ launch is believed to be the first of kind in New Zealand. 

The new product was given seal of approval by housing minister Phil Twyford. Twyford said: "We are looking at a similar scheme for low income earners so it’s great to see BNZ looking at a progressive home ownership model like this.”

The shared ownership scheme will be launched early in the New Year, BNZ said. 

It comes as first home buyers continue to put in a strong showing in the market. FHBs borrowed $920 million in October, up from $722 million in October 2017. The figure is the second highest on record, based on RBNZ data going back to August 2014. Investor lending remained subdued, however, amid ongoing LVR restrictions and the threat of further action against investors.

Tags: BNZ Lending

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Comments from our readers

On 10 December 2018 at 12:21 pm Good Hamish said:
Will be interesting to see if shared equity schemes fall into the RBNZ restriction for 35% deposit for investors. Surely you can't invest in housing through an investment fund or company get around the spirit of RBNZ investor restriction.

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Lender Flt 1yr 2yr 3yr
AIA 4.55 2.55 2.69 2.79
ANZ 4.44 3.15 3.25 3.39
ANZ Special - 2.55 2.69 2.79
ASB Bank 4.45 2.55 2.69 2.79
Bluestone 3.49 3.49 3.49 3.49
BNZ - Classic - 2.55 2.69 2.79
BNZ - Mortgage One 5.15 - - -
BNZ - Rapid Repay 4.60 - - -
BNZ - Std, FlyBuys 4.55 3.15 3.29 3.39
BNZ - TotalMoney 4.55 - - -
CFML Loans 4.95 - - -
Lender Flt 1yr 2yr 3yr
China Construction Bank 4.49 4.70 4.80 4.95
China Construction Bank Special - 2.65 2.65 2.80
Credit Union Auckland 5.45 - - -
Credit Union Baywide 5.65 3.95 3.85 -
Credit Union South 5.65 3.95 3.85 -
First Credit Union Special 5.85 2.95 3.45 -
Heartland 3.95 2.89 2.97 3.39
Heartland Bank - Online - - - -
Heretaunga Building Society 4.99 3.85 3.95 -
HSBC Premier 4.49 2.45 2.60 2.65
HSBC Premier LVR > 80% - - - -
Lender Flt 1yr 2yr 3yr
HSBC Special - - - -
ICBC 3.69 ▼2.45 2.65 2.79
Kainga Ora 4.43 2.93 3.07 3.24
Kiwibank 3.40 3.30 3.54 3.54
Kiwibank - Offset 3.40 - - -
Kiwibank Special 3.40 2.55 2.79 2.79
Liberty 5.69 - - -
Nelson Building Society 4.95 3.45 3.49 -
Pepper Essential 4.79 - - -
Resimac 3.39 3.35 2.99 3.35
SBS Bank 4.54 3.05 3.19 3.25
Lender Flt 1yr 2yr 3yr
SBS Bank Special - 2.55 2.69 2.75
The Co-operative Bank - Owner Occ 4.40 2.55 2.69 2.79
The Co-operative Bank - Standard 4.40 3.05 3.19 3.29
TSB Bank 5.34 3.29 3.45 3.59
TSB Special 4.54 2.49 2.65 2.79
Wairarapa Building Society 4.99 3.55 3.49 -
Westpac 4.59 3.15 3.29 3.39
Westpac - Offset 4.59 - - -
Westpac Special - 2.55 2.69 2.79
Median 4.55 3.00 3.13 3.02

Last updated: 21 September 2020 10:48am

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