Need help with a plan?

Share it Own it – First Home Kickstarter (SiOi-FHK)

What is it?

If you (or with your partner) have a good income and your parents are happy to help you with a kickstart, Share it Own it might be able to assist. With our unique framework we help assist buyers parents, willing to contribute towards the purchase. Best of all we make it simple, convenient and more cost effective than traditional methods. We’ve helped numerous kiwis already into property, let’s see if we can help you.

Who benefits from this plan?

– First home buyers
– Parents willing to help children into property

Overview

First Home Kickstarter is a shared ownership framework. Similar to how a company can be split into shares, if a property could be ‘shared’ also, all owners can partake in the benefits. Over time, the kids ‘buy-out’ the shares that the parents own in the property at market value when they are able to. Using our framework helps with the equity transfer to be more fluid between parties over time. As equity shifts between the parties this allows for the ownership to adjust over time. First Home Kickstarter helps limit the parents exposure and for the risk that they do take, they’re rewarded for it in a fair way.

Benefits of First Home Kickstarter
– You can buy the home now. The sooner you can buy, the less it will cost you (if property prices keep increasing).
– Exposure is limited to just 20% of what is required. This is all that will be secured against the parents’ home.
– Your siblings can potentially do the same thing – you’re not monopolising your parents equity.

Risks of First Home Kickstarter
– The parents will have to pay back the 20% to the bank if the kids default on their mortgage.
– The property could go down in value, like any asset.

Example of SiOi – First Home Kickstarter

Emily and Adrian want to purchase their first home but as a result of repaying student loans and doing an OE, they don’t have much apart from Kiwisaver to assist with the deposit. The parents have always suggested that they would be willing to ‘act as guarantor’ for the kids, as this is what they did for Emily’s older sister. Due to the lending rules changing however the parents are surprised to learn that it’s not as easy as it used to be – the bank requires them to act as borrowers for the entire loan of the kids!

Before they give up they stumble across this case study and realise perhaps First Home Kickstarter could work for Emily and Adrian. The parents and the kids together went through the SiOi’s questionnaire, and after some discussion with an adviser, the first home purchase is initiated. The parents have acted as a ‘limited guarantor’ for the purchase of Emily and Adrian’s first home and for the risk that they’re taking, they own a share in the kids home. In order to buy out mum and dad, the kids decide to value the property in 7 years’ time, top up their mortgage, and buy out the shares that mum and dad own.

Now retired and enjoying their ‘golden years’ the parents are fully debt free with a little nest egg to help with their next cruise. More importantly, Emily and Adrian own a property that has increased in value significantly in just 7 years – where would they be without mum and dad, and of course SiOi – First Home Kickstarter!

What do you need to get started with the First Home Kickstarter plan?

– You are looking to get into your first home or step up into your next home?
– You have the income needed to service a mortgage but might have very little saved in the way of a deposit?
– You have parents who are willing to help, but who don’t like the idea of guaranteeing your entire debt?
– Your parents or partners parents own a home?

If you’ve answered yes to the above questions and are keen to find out more, use the enquiry form below to tell us a bit more about your situation. We’ll come back to you and have a further conversation to see if we can help you. Share it Own it is on a mission to help more kiwis into shared property ownership.