Couples earning up to $180,000 a year will be allowed to buy affordable KiwiBuild homes - as long as they live in them for at least three years.
The Government is unveiling on Wednesday who will be eligible to buy one of the 100,000 affordable KiwiBuild homes it is hoping to build over the next 10 years.
Documents released to Stuff show the criteria will include an income test - but one that will still allow 92 per cent of first home buyers to get into the scheme.
The income cap is $120,000 for a sole buyer or $180,000 for a couple.
The documentation spells out the main points of the criteria.
Both citizens and New Zealand permanent residents will be eligible.
The homes will be available to all first-home buyers and most "second-chancers" - usually people who go through a divorce and have lost property. Second-chancers must not have assets exceeding $120,000 in Auckland, $100,000 in most other cities, or $80,000 for the rest of New Zealand.
First-home buyers will not be subject to a financial asset test - they will simply need to be buying a first home.
The relatively high income cap will allow 92 per cent of first home buyers to be eligible, documentation from Housing Minister Phil Twyford's office shows.
Those who purchase a home will need to live in it for at least three years without selling it, but will be able to rent out spare rooms to flatmates.
Some purchasers will be able to sell the home within three years if special circumstances such as a death or serious illness occur - but they will need to apply for permission from the Government, who will consider each person on a case-by-case basis.
For the first years of the scheme, the homes will be balloted, meaning every eligible buyer who enters will have an equal chance of buying a home.
Potential buyers can register their interest online but will have to go through an eligibility check before being entered into the ballot.
The income bracket is substantially higher than the one for the HomeStart grant, which cuts off at $130,000 for couples and $80,000 for single buyers.
Twyford said there were plenty of people earning close to the limit struggling to buy homes in high-cost areas.
"We know that New Zealanders at and below these incomes are struggling to buy a home, especially in high demand areas such as Auckland and Queenstown," Twyford said.
"For instance a couple of teachers may have a combined income of between $150,000 and $170,000. For a nurse and police officer earning upwards of $120,000, and for an engineer living alone, $90,000. A decade ago these families would have been able to afford a home, but they are now locked out of the market."
The Government has scrapped its plans for a Kiwibuild Visa in favour of wider changes to immigration settings.
Twyford had earlier indicated he would not be keen to introduce income caps for the scheme.
Documentation released by Twyford's office shows that households in the $80,000-$180,000 range have experienced the largest decline in homeownership over the past decade - and that nearly half of all families with children fall into that category.
KiwiBuild homes have price caps that differ across the country.
Three-bedroom homes in Auckland and Queenstown will cost $650,000 or less, with two-bedroom homes costing $600,000 or less and one-bedroom homes costing $500,000 or less.
All KiwiBuild homes outside of Auckland or Queenstown will cost $500,000 or less.
The Government is planning a gradual ramp-up of KiwiBuild homes, with 1000 built by July 2019, 5000 the following year, and then 10,000 the year after that.
Half of all the homes will be in Auckland while the other half will be spread out across the rest of New Zealand.
National has repeatedly criticised the policy, saying it will suck up capacity from the private sector while costing the taxpayer money.
Housing spokeswoman Judith Collins has also said eligibility criteria should lock out Kiwis coming home from long periods working overseas and not paying local taxes - something the criteria announced on Wednesday will not do.
KiwiBuild has a $2b budget, which the Government wants to "recycle" as the houses are sold at cost price to buyers.
Home ownership has been falling for the past three decades, from 75 per cent in 1991 to around 63 per cent in recent years.
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NZ and overseas companies asked to ramp up prefab ops for Kiwibuild
Last updated 10:29, June 25 2018
Housing Minister Phil Twyford says he hopes more than half of the Government's 100,000 Kiwibuild homes will be made by prefabrication.
Twford has asked companies in New Zealand and overseas to express their interest in setting up, or expanding, off-site manufacturing factories to make KiwiBuild homes.
"Cabinet has decided the Government will seek interest from both local and overseas companies to come forward with their plans," Twyford said.
"One of the challenges for Kiwibuild is there isn't the scale and capacity in the construction sector to build the number of houses New Zealand needs."
On Saturday, Twyford told The Nation he could not currently put a number on the number of prefab houses built under Kiwibuild, but within a few years - when the Government was building about 10,000 houses a year - "a substantial proportion" of the houses would be built in a factory using high-tech, high-precision gear.
He then said he hoped more than half the houses would be prefab, "but it's very early days to be putting a number on that".
Twyford said he had been approached by international and domestic companies, which were already using off-site manufacturing to build houses quicker and more efficiently, since the Government launched KiwiBuild.
"High-tech manufacturing of homes, as is done in Europe and North America, could allow us to build Kiwibuild homes at scale and pace."
Off-site manufacturing was significantly more productive so more homes could be built from the available workforce, and it would help address some of the constraints facing the construction sector until New Zealand could find enough local builders, he said.
New products and techniques used in off-site manufacturing meant houses could be built up to four times faster, he said.
Using prefab buildings had always been part of the Government's Kiwibuild plan - even ahead of taking office.
Earlier this year, PrefabNZ released a report, showing prefabricated factory-built houses and apartments could deliver at least 7000 homes a year from 2020.
Twyford said this meant large-scale factories could be established in New Zealand, working alongside existing off-site manufacturing companies. "Off-site manufacturing will be a game changer for New Zealand housing."
But National Party housing spokesperson Judith Collins said the "plea to the private sector for help" showed the Government was struggling to deliver on its Kiwibuild promise to build 100,000 affordable homes in 10 years.
"It's not that pre-fabrication is a bad idea, and National supports efforts to build more houses," Collins said. "But Kiwibuild was first announced in 2012. Now six years later and after eight months in Government his grand plan amounts to a plea to the private sector to bail him out at some point down the track."
Construction is underway on the first 18 Kiwibuild homes, all of which are in south Auckland.
Twyford said the Government would build 16,000 Kiwibuild homes in the first three years of the scheme - 1000 in the first year, 5000 in the second and 10,000 in the third.
In the House, Twyford said he projected 200 to 300 Kiwibuild homes to be built through Housing NZ, and the land for housing streams in the first year. Meanwhile, about 700-800 would be built through private development. If the Government can deliver these homes, it would put it on target for its goal of 1000 in 2018/19.
But deals needed to be signed before the minister would make announcements on the developments.
Prefab manufacturing of housing will be a "game changer" in New Zealand, Housing Minister Phil Twyford says.
Mr Twyford announced today the government will formally invite expressions of interest in off-site construction for KiwiBuild houses - from companies both here and overseas.
KiwiBuild is designed to help first home buyers, especially in Auckland, get into the property market. The aim is to build 100,000 affordable homes over the next 10 years.
Mr Twyford hoped that more than half of the KiwiBuild homes would be built in off-site factories.
"High tech manufacturing of homes, as is done in Europe and North America, could allow us to build KiwiBuild homes at scale and pace," he said in a statement.
However, he said it would take a few years to establish a factory line large enough to build the required number of prefab homes to get on top of the housing crisis.
However National's spokesperson for Housing and Urban Development Judith Collins has accused the Housing Minister of creating confusion and bringing the construction sector to a grinding halt.
"After six years and eight months he can't answer basic questions like how the industry would be funded, how the industry and buyers would get around bank lending restrictions, how he would free up land to build houses on and how he would get around his government's immigration chaos to find the construction workforce needed," said Ms Collins.
"His only hope is that the private sector he has so consistently disparaged will have the answers.
"Mr Twyford has spent years claiming he would build 100,000 affordable houses for New Zealanders, no ifs or buts. Now his KiwiBuild pipedream has descended into farce," Ms Collins said.
The government will announce the details of large-scale urban developments for KiwiBuild homes in the next few weeks.
There are eight Auckland locations the govenment is currently doing due diligence on.