oct 3, 1974 - Home Ownership Savings Accounts Scheme - starts
Description:
1974-1986
The Home Ownership Savings Act 1974 established Home Ownership Accounts to encourage savings for home ownership. Benefits to savers included a Purchase Grant and an Interest Subsidy.
The qualifying date for depositors was the date at which the balance in their account reached $250. Deposits in a Home Ownership Account did not qualify as eligible savings until three years following deposit. Eligible savings could not exceed $5,250
A depositor who had been saving for at least three years and who withdrew their savings for the purpose of acquiring a dwelling in New Zealand was eligible for a Purchase Grant equal to 25 percent of their eligible savings.
A depositor who received a Purchase Grant and who had borrowed money at interest to assist in the acquisition of the dwelling was eligible for an Interest Subsidy for each of the five years succeeding the date of payment of the Purchase Grant. The amount of the Interest Subsidy was calculated in the following manner:
• 2.5 percent of the amount by which eligible savings at termination date exceeded eligible savings one year before the termination date; and
• 5 percent of the amount by which eligible savings the date one year before the termination date exceeded eligible savings two years before the termination date; and
• 7.5 percent of the amount by which eligible savings the date two years before the termination date exceeded eligible savings three years before the termination date; and
• 10 percent of the amount by which eligible savings the date three years before the termination date exceeded eligible savings four years before the termination date; and
• 12.5 percent of eligible savings four years before the termination date.
The amount of the Interest Subsidy could not reduce the interest rate below three percent per annum.
If the depositor disposed of the dwelling, sale or subletting, in whole or part, without the written consent of the Housing Corporation of New Zealand, they were liable to repay any benefits received.
The scheme was abolished for new entrants in 1986.
Source: https://www.msd.govt.nz/about-msd-and-our-work/about-msd/history/social-assistance-chronology-programme-history.html
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