Progressive Home Ownership

As house prices have increased, families who would once have bought a home have been priced out of home ownership. 

The Government's $400 million Progressive Home Ownership Fund will help between 1,500 and 4,000 New Zealand families buy their own homes. The Fund will enable low to median income households partner with a progressive home ownership provider to access shared ownership, rent to buy, or leasehold arrangements to step into home ownership.

The Fund has a specific aim to address housing affordability issues for three priority groups: Māori, Pacific peoples, and families with children. The Fund will focus on places in New Zealand where housing affordability issues are most severe and where progressive home ownership can best help to address this.

From mid-2021, eligible households will be able to access the Fund through one of two approaches:


Low to median-income families can access the Fund through progressive home ownership providers, who will support these families into home ownership. Under this approach, there will also be a dedicated iwi and Māori pathway, with a specific focus on better outcomes for Māori.


Households at or above median incomes will also be able to access progressive home ownership arrangements directly from government, through Kāinga Ora – Homes and Communities.

Phase 1 of the Fund

We are taking a staged approach to the Fund and starting with initial funding of $45 million to support New Zealand families buy their own homes.

To deliver Phase 1, we are working with well-established housing providers with existing progressive home ownership products. These providers are experienced and have the scale, size, and access to developments needed to operate more quickly.

In July last year, the Minister of Housing announced the first two confirmed PHO providers - NZ Housing Foundation and Queenstown Lakes Community Housing Trust. Loans to these providers, through the PHO Fund, will together help around 100 low to median income families step into home ownership in Auckland and Queenstown.

The next confirmed PHO provider is Manawa PHO Limited (the housing arm of Ngā Pōtiki ā Tamapahore Trust). The loan will help 30 more families step into home ownership in Pāpāmoa, an area with significant housing affordability issues.

Habitat for Humanity have also had a PHO loan confirmed to help 33 families own their own home in Auckland, Hamilton and Nelson.

Funding will soon be available to a wider group of providers covering a broader range of locations.

Households will be able to access the direct scheme from Kāinga Ora – Home and Communities website in the coming months.

Family helped into progressive home ownership

The video below featuring Tony and Tonya Seiuli on how the Progressive Home Ownership Fund is already impacting the life of a family as they partner with the NZ Housing Foundation to become home owners.

Transcripts for Progressive Home Ownership


Tony: The best thing about owning our own home is having a place to call home. Having somewhere where our children can always come back to when they grow up and they decide to have their own children.

Tonya: If we were to go and rent again we would just be starting all over again. We've moved out of so many properties because they've been sold and had to restart, restart. Over and over again.

Tony: It's very difficult to buy a house. In any area, in and around where we were brought up. So we're from Manukau and in this area here, Flatbush it's just way too expensive.

Tonya: Since we've been together we've rented four different houses and we've never actually settled and been stable in a house. It's always been packing up and moving packing up and moving. I've been really worried because every time you move we've had to change our daughter's school. She's never got the stability that she should get in her education.

Tony: So do you guys know where your bedroom is going to be? I think your room is going to be up the top.

Child: No my room is right here.

Tonya: Ah that's the garage.

Tony: Owning the house for us is amazing. Owning a house in this area with the schools that are available to our children is just what we've dreamed about and it's something for them for their future and definitely an investment for us as well in the future. We couldn't have bought a house without this fund available.

For more information

We have listed some Frequently Asked Questions about the Fund - please see the section below.

If you would like further information about the Government’s Progressive Home Ownership Fund, please email  

Frequently Asked Questions

What is Progressive Home Ownership?

Progressive home ownership enables a family to partner with a provider to help them become homeowners. It can take several forms, including:   

  • Shared equity or ownership, where a household owns part of the home and a third party owns the rest. Over time the household buys back the portion of the home from the third party (e.g. housing provider or the Crown).  
  • Rent to Buy, where the provider purchases a house outright and a household rents that home from the provider, possibly at below market rates to enable them to save a deposit. Alternatively, a standard market rent could be charged with the provider setting aside a portion of that rent as a deposit on behalf of the homeowner. The household may have the right to purchase the home either outright or through a shared equity scheme. 
  • Leasehold, where a provider sells a home to a household but retains ownership of the land beneath it. The exclusion of land from the purchase lowers the deposit and servicing cost for the homeowner. The homeowner may be required to pay a ground rent to the landowner for ongoing use of the land. In some cases, homeowners may have the right to purchase the land from the provider at a later date, once the homeowners have paid down some of their debt and are better able to afford it. 

Why is the Government funding the Progressive Home Ownership Fund? 

As house prices have increased, many families who could once have purchased a home have been priced out of home ownership. Families who can service some but not all of a mortgage are more likely to be families with children, Māori, and Pacific peoples. Given the gap between house prices and what is affordable to these families, many will not be in a position to purchase a home in the future. Progressive homeownership schemes can help these families by sharing the cost of a mortgage and addressing the deposit barrier.  

These innovative arrangements are already offered in small numbers through community housing providers. Building a role for Government in their delivery, and supporting those that provide them to scale up and expand the number of people they can help, is a way to increase the number of New Zealanders able to own their own homes and to build the country’s housing stock.

Who is the Progressive Home Ownership Fund going to help? 

The Progressive Home Ownership Fund aims to help:

  • lower to median income families who are unlikely to buy a home without a reasonable level of financial and non-financial support, and 
  • at or above median income families who cannot get a large enough deposit together to buy a home due to high rents and fast-growing house prices, and/or have insufficient income to service a low deposit mortgage at current house prices. 

How does the PHO Fund fit in with other homeownership opportunities developed by the Government?

The Fund sits alongside our other key housing programmes to help ensure every New Zealander has a safe, warm, dry home to call their own. It will be an important tool to assist some people into home ownership who otherwise would not be able to buy a home. The Fund is part of the government’s comprehensive housing programme, which includes working to:

  • prevent and reduce homelessness and reduce reliance on motels as emergency accommodation. Funding provided through Budget 2019 will expand and strengthen the Housing First programme and help to fund and maintain over 2,800 transitional housing places throughout New Zealand
  • make life better for renters, by passing the Healthy Homes Guarantee Act 2017. We have also banned letting fees, and our reforms of the Residential Tenancies Act are underway
  • increase the stock of public houses owned by Kāinga Ora and community housing providers. Through Budget 2018, we funded the delivery of 6,400 new public housing places, of which 2,178 were delivered in 2018/19.

The Government has also improved incomes for low- and middle-income families with children through the Families Package in 2018. The Families Package increased the Accommodation Supplement, providing around 135,000 households with an extra $35 per week on average to help pay for their housing related costs.

Who is eligible for funding?

The criteria for funding includes:

  • applicants must be over the age of 18,
  • applicants must not currently own any property in New Zealand or overseas,
  • applicants must be a New Zealand Citizen, Permanent Resident, or Resident Visa Holder who is 'ordinarily resident in New Zealand',
  • applicants must have a household income of under $130,000 per year 1, and
  • applicants need to be first home buyers or ‘second chancers’ (as defined in the eligibility criteria for KiwiBuild).


1  The income cap for assistance from the Fund is set at $130,000 per year, with some flexibility for multi-generational households. However, progressive home providers funded through Phase 1 are able to use their existing processes for selecting households within this income cap, as this is an essential part of the success of providers’ schemes. Furthermore, in retaining flexibility for who they select, we expect that households assisted are from providers’ existing waiting lists that are ready for a progressive home ownership scheme.

How many people will the Fund help? 

We expect between 1,500 and 4,000 households will be helped into home ownership through the Fund. The number will depend on the amount of money loaned to each recipient and how quickly they are able to pay it back.

Will the Fund help more Māori into home ownership? 

The Progressive Home Ownership Fund has a specific aim to address affordability issues for Māori, Pacific peoples, and families with children.  

Officials are working with iwi and Māori providers and organisations to ensure that the Fund can deliver better home ownership outcomes. This includes looking at:    

  • how progressive home ownership schemes can be accessible to Māori (including in rural areas and on Māori land), and     
  • how Māori providers (existing or emerging) are able to scale up.  

How much is this going to cost? 

The Government has made $400 million available for the delivery of Progressive Home Ownership schemes. Funding is also available for providers to provide households with non-financial support, such as financial capability services.

Will the government get the $400 million in funding back?

Yes, funding needs to be returned to the Crown.

When will housing providers be able to apply through the Fund?

Phase 1 of the Fund has started with community housing providers already experienced in delivering progressive homeownership schemes. We expect funding will be available to a wider panel of providers early next year.

While Phase 1 is significant, with a sizeable amount of funding available through repayable loans, the full Fund will have a much bigger scale. A provider that is not involved in Phase 1 may (if eligible) still be engaged for the full Fund. HUD will share lessons from Phase 1 with all providers so there is no first mover advantage.

When will the direct government Fund be available?

The direct government product is currently being designed. We expect that it will be available in the coming months and will be led by Kāinga Ora.

Is the Progressive Home Ownership Fund the KiwiBuy Coalition scheme?

No. While the KiwiBuy proposal and the Progressive Home Ownership Fund share an objective of scaling up provision of Progressive Home Ownership schemes by existing providers, the Fund will also provide new pathways to access such schemes and support a wider range of households into homes than the KiwiBuy proposal.

What information has been used to model the funding?

We have modelled the financial outcomes for the scheme on a number of assumptions such as interest rates, regional prices, capital value increase, target group characteristics/incomes, and exit paths. We have also undertaken initial actuarial modelling and sensitivity testing. These will be refined as more data becomes available through phase one.

Published: January 22, 2021