People who've withdrawn their KiwiSaver to buy a house can't do so again after they've left a relationship. Photo: 123RF
When Violet* accessed her KiwiSaver to buy a house more than a decade ago, she only had about $3000 available.
She withdrew the money and received a First Home Grant to help with the purchase.
But six years later she and her partner separated and sold the house.
*Violet, whom RNZ has agreed not to identify, is now on her own and has built up $50,000 in her KiwiSaver.
She would love to be able to buy a house for herself and her children, and $50,000 would be enough for a deposit on the type of property she would like to buy in Manawatū.
But she has been told she cannot access her KiwiSaver again because she has already withdrawn money for a home.
"There's no other option for me to be able to tap into that. I only used $3000 because that's all I had in KiwiSaver at the time. Now I can't access the $50,000 I've got in there now."
While there is an option for "second chance" buyers to withdraw money from KiwiSaver for a second home, that only applies to people who have not used their KiwiSaver previously.
They need to now be in the same financial position as a first-home buyer.
Pie Funds chief executive Ana-Marie Lockyer said the criteria was fairly strict.
People also needed to not have assets worth more than 20 percent of the house price cap in the area they were looking at, and needed not to have any other property ownership, even if it was only land.
"It's understandable this person is frustrated, as the rules don't seem to cater for people in her position."
Financial coach Shula Newland said it would take Violet many years to save a deposit for a house outside KiwiSaver, so she was effectively locked out of the market.
"I really think the government needs to review the rules around being able to get money out again.
"This will also help with separations, as they - mostly women - could park their money in KiwiSaver till they are ready to buy another home."
She said it was a common situation at the moment because the recent drop in house prices meant many people did not have enough money left for another deposit when they sold their homes in a separation.
She said women were also more likely to spend any payout on living and taking care of children after a separation, so if there was a way to keep it in KiwiSaver and withdraw it later, it could put them in a better position.
In April, 3970 people withdrew savings from KiwiSaver for a first home, for a total of $167.3 million.
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