PHOTO: FILE
đ Once Bitten, Forever Banned? How Relationship Breakups Are Freezing Kiwis Out of the Property Market
A growing number of New Zealandersâespecially women leaving long-term relationshipsâare discovering a harsh reality: even with tens of thousands saved in KiwiSaver, they’re blocked from re-entering the property market.
đ¸ âI only used $3,000 back then⌠now I have $50,000, but Iâm not allowed to touch it.â
Thatâs the situation facing Violet*, a solo mum in the ManawatĹŤ, who used a modest KiwiSaver withdrawal to buy her first home over a decade ago. Now, post-separation and raising children, she has enough saved for a depositâbut the rules say sheâs ineligible.
đŞ Why Former Homeowners Are Shut Out of KiwiSaver Access
KiwiSaver rules currently state that you can only withdraw your funds once for a first home purchase. Violetâs $3,000 withdrawal many years ago disqualifies her from accessing the $50,000 she has built up since.
đŁď¸ âThereâs no other option. Iâve asked. Even though I only used a tiny amount the first time, Iâm locked out now.â â Violet
Even the âsecond chance buyerâ criteria, designed for people whoâve been out of the market, does not apply to herâbecause she has used KiwiSaver for a home in the past.
đŠââď¸ Financial Coaches: âThis Disadvantages Separated Womenâ
đŹ Financial coach Shula Newland says Violetâs story is far from unique.
She warns that KiwiSaverâs rigidity is harming separated women, who often spend any post-breakup payouts on rent, childcare, and daily living, leaving little room to save a fresh deposit.
đŤ The Catch-22:
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Used KiwiSaver once = disqualified forever
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No second home option unless you never used it before
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Criteria doesnât reflect post-separation financial hardship
đ§ âThis will take Violet many more years to save outside of KiwiSaverâif she can save at all. The rules need to change.â â Shula Newland
đ Falling House Prices, Rising Desperation
Recent drops in property prices have not made it easier for separated individuals. Many don’t get enough equity back to reinvest after selling a home due to a relationship split.
And while some might assume KiwiSaver would be a safety netâitâs not.
đ¨âđź Ana-Marie Lockyer, CEO of Pie Funds, confirms the rules are âfairly strictâ, requiring applicants to essentially have no assets and no prior withdrawals.
đ˘ By the Numbers: KiwiSaver First Home Withdrawals
đ In April 2025 alone:
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3,970 Kiwis withdrew KiwiSaver funds to buy a first home
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$167.3 million was released to help secure those purchases
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Yet none of it was accessible to people like Violetâjust because they bought once before
đ ď¸ Time for Policy Reform?
Experts are calling on the Government to rethink KiwiSaver withdrawal rulesâespecially for those who have lost their homes due to separation.
âď¸ A proposed solution?
Let KiwiSaver withdrawals be used again in the event of a proven separation or financial hardship, particularly when women and children are at risk of long-term rental dependency.
đ Until then, thousands may remain locked in a cycle of renting, despite having tens of thousands saved.
đ Final Thought
KiwiSaver was designed to give Kiwis a foot on the property ladderâbut for many, a breakup means losing that grip entirely. Without reform, Violetâs story could become the rule, not the exception.
SOURCE: RNZ