Navigating a Shared ownership agreement with Kainga Ora
SM Property

April 28, 2023

If you’ve read our previous blogs, you’ll know that Kainga Ora First Home Partner is a government scheme to help first home buyers through shared ownership. Shared ownership means you and Kainga Ora will sign an agreement to co-own the property. This can allow you to purchase a home that might otherwise be out of your budget, with KO providing a share of the property.

But how do you navigate this shared ownership agreement with Kainga Ora? Here’s what you need to know.

Understand your responsibilities

As the majority homeowner, you are responsible for maintaining the property. You’ll also need to seek approval from KO for any significant renovations or improvements. You need to commit to living in the home for at least three years from the settlement date.

Understand Kainga Ora’s responsibilities

Kainga Ora acts as a “tenant in common co-owner”. This is a legal arrangement where two or more people own a property together, with each person having a distinct share. They’re responsible for conducting annual meetings with you, to help you stay on track with your goals towards home ownership. They do this through their Goals Management Programme.

Buying the share owned by Kainga Ora

If you want to become a full homeowner, you’ll need to buy the share of the property owned by Kainga Ora. This can be done through a single lump-sum payment, or smaller individual payments. The dollar amount is determined by the value of the home at the time. This means if the value of the property has increased since your purchase, the share owned by Kainga Ora will cost more to purchase. This is the same if the market value has dropped since the purchase – the amount you need to pay will drop.

Navigating the shared ownership agreement with Kainga Ora may seem daunting at first. But with a clear understanding of your and Kainga Ora’s responsibilities, you can successfully manage your shared ownership arrangement. The SM Property team have helped several Kiwis into their first home through the KOFHP. We’re here to help you, so contact us today to start your home buying journey.

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