How much deposit do I need to buy a property?
While a good general rule for anyone planning to live in the property they buy is that they will need a deposit of 20 percent of the purchase price, this can vary depending on a number of factors.
These include the type of home loan you are seeking, as well as the lender you choose. Anyone purchasing a property for an investment is generally required to provide a deposit worth 30 percent of the purchase price.
Your deposit may come in the form of savings and KiwiSaver, as well as contributions from other avenues, which can include family assistance, gifts or bonuses, equity in other property.
What happens to the deposit paid to the agent?
When a contract is signed, a 10 percent deposit is usually required. In some cases, an agent may ask for a smaller amount to be paid when an offer is submitted.
When you pay your deposit to an agent, it will be paid into a trust account they operate. No interest is payable from this type of account.