Labour leader Chris Hipkins says the Government will be "absolutely smashing" an entire generation's dream of getting on the property ladder if it goes ahead with scrapping First Home Grants.
Newshub revealed on Tuesday the Government is set to scrap the $60 million given to first-home buyers in grants in next week's Budget and redirect the money to social housing.
Appearing on his regular AM slot, Hipkins said the scheme, which was introduced by the previous National Government, was a good policy that gave first-home buyers a small boost to get onto the property ladder.
"I really can't understand, if the Government are going to abolish this, why they would even be considering that," Hipkins told co-host Lloyd Burr.
"They're just absolutely smashing the dream of first homeownership for a whole generation of New Zealanders at the moment."
First-home grants are a government contribution to first-home buyers. Buyers can get up to $5000 for an existing home or $10,000 for a new build if they earn less than $95,000 as an individual buyer or $150,000 as a household. There are price caps for the houses you can buy according to regional prices.
"We are talking a couple of thousand dollars that you get for a first home grant," Hipkins said. "They found billions, literally billions of dollars, to give to landlords in tax cuts."
"It shows that they want us to be a nation of renters, where fewer and fewer people own the houses. Actually, I want New Zealand to be a country where everybody does get the chance to own their own home – that's clearly not the direction this Government are heading in."
National didn't campaign on scrapping the grants, which Hipkins said is "bad faith" to the electorate if the axing goes ahead.
"First home ownership is such a big thing for younger New Zealanders. I think it's something that we should be looking at how we can do more to support that, rather than less," he said.
Finance Minister Nicola Willis while in Opposition had attacked the previous Labour Government over the number of grants paid out dropping in 2021.
However, the scheme has had a big uptake.
In the year to February 2024, nearly 25,000 households bought their first home, in that time 10,500 first-home grants were paid out, meaning 42 percent of first-home buyers accessed the grant.
The revelation came after the Government announced a broad review of the existing housing programmes that it runs in response to a scathing review of Kāinga Ora.
Housing Minister Chris Bishop has already confirmed Kiwibuild will be scrapped but when asked whether other programmes that help first-home buyers would be cut, he dodged the questions.
Sources later confirmed to Newshub that the grants will be abolished in the Budget next week.
