The Government announced at the weekend that the laws would change so that people who have jobs where accommodation is provided can still use their accounts to buy a house.
The rules have previous required that people withdrawing money for a first home do so with the intention of living in it.
"Workers in service tenancies, such as farm workers, rural teachers, country cops, and defence personnel, have effectively been locked out of first home withdrawal because their jobs require them to live in employer-provided housing," Finance Minister Nicola Willis said.
“That’s not fair, so we're making a technical change to the KiwiSaver Act to ensure workers in service tenancies aren't denied the opportunity to put a foot on the property ladder.
"The change will allow service tenancy workers to use their KiwiSaver for a first home purchase without having to live in it."
People will also be able to use their KiwiSaver balances to purchase a farm through a commercial entity they majority own, when they plan to live on it.
Pie Funds chief executive Ana-Marie Lockyer said the service tenancy change was logical.
“Allowing balances to be used in connection with purchasing commercial farming operations raises more complex issues. The devil will be in the detail, and as a provider, we’ll need to understand the operational impact once that detail is clear.
“Stepping back, I’d prefer to see less tinkering with KiwiSaver settings and more focus on a bipartisan long-term strategy. KiwiSaver is now central to New Zealand’s retirement system — it deserves stability and a clear roadmap for the next 20 to 30 years.”
Financial Services Council chief executive Kirk Hope also told media he had similar concerns. He said any time the scope for withdrawals was widened, it could undermine the scheme as a retirement savings vehicle.
Koura founder Rupert Carlyon said he was not convinced the changes would make much difference.
“The changes look sensible, but the devil will be in the detail. Personally, I very much doubt there will be very many farmers that end up using KiwiSaver to buy their farms that are not already doing so - you are already allowed to use them if buying in your personal name.
“I also support the idea that people provided with housing for their work will be able to buy a house using their KiwiSaver.
“My only concern would be, is this a great use of Parliament’s time? I suspect we are talking about hundreds of additional withdrawals a year here - a lot of effort for a pretty small change.”
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