Squirrel’s Launchpad: Helping Kiwis into First Homes

Squirrel’s Launchpad is a new kind of mortgage product that’s helping prospective Kiwi home owners. Canstar looks at how Launchpad can help propel you into your first home.

If you’re a prospective home owner, you’ll know that one of the hardest parts of buying a first home isn’t managing the mortgage, it’s saving for the deposit. But now, thanks to Squirrel’s Launchpad – a new mortgage product designed for first home buyers – getting into a first home has become a little easier.

Squirrel’s Launchpad: Helping Kiwis into First Homes. In this article we cover:

What help is already available for first home buyers?

It’s hard trying to save for, and buy, a first home in New Zealand … on multiple levels:

  1. House prices are through the roof. They’ve been on the up for a decade, but over the past year they’ve become hotter than cryptocurrency following a favourable Elon Musk tweet!
  2. Saving a sizeable deposit takes years, and all the time property prices are rising further
  3. While saving for a deposit, you still have to pay rent, and rents are certainly not going down

There is help for first home buyers. And recently the government tweaked the legislation, increasing the income caps for the First Home Loan and the house price caps under the First Home Grant scheme.

Under the First Home Loan scheme, borrowers are now eligible for a home loan with just a 5% deposit if they earn under $95,000 a year for one person, or under $150,000 for two or more people buying together. This is up from the previous figures of $85,000 and $130,000, respectively.

And around the country property price caps have increased, from a rise of $50k, in Christchurch, to $125k, in Dunedin and the Waikato.

→ Related article: What is the Kāinga Ora First Home Grant? And How Much is It?

But all this is of little help if you’re on a decent salary and looking to purchase outside those price bands. And this is where Squirrel’s Launchpad can help.

What is Squirrel’s Launchpad?

Launchpad is a hybrid blend of a regular mortgage and a personal loan. It’s designed specifically for first home buyers who earn too much to qualify for government assistance, but still need a little help with their deposit.

Saving for a traditional 20% deposit can add years to saving for a first home. But Launchpad cuts the deposit needed to 5%, for properties up to $800k, and up to 10% for more expensive properties.

House price 

Maximum LVR
(Loan-to-value ratio) 

Minimum deposit 

Launchpad loan





















How does Squirrel’s Launchpad work?

Launchpad works by splitting the loan into two parts. The biggest part comprises the traditional base loan, while the other part is the equity loan.

Base Loan (80% of house price)

This works like a traditional 30-year mortgage, with a choice of a floating or fixed interest rate. Current rates:

  • Floating: 3.49%p.a.
  • 1-year fixed: 3.34%p.a.

  • 2-year fixed: 2.99%p.a.
  • 3-year fixed: 3.34%p.a.

For the first five years of this loan, your repayments are set as interest-only. This means you can focus on paying off the equity part of the loan, which comes with a higher interest rate.

Equity Loan (up to 15% of house price)

This part of the loan works like a conventional personal loan. As such, the interest rate is a lot higher than the base loan. Current rate: 9.95%p.a. (subject to change).

The term of the loan is five years, which is the same as the interest-only period set for the base loan. During this time you can make extra payments at no extra cost, to pay off the loan faster.

The maximum equity loan available is $120,000, which means that if the house that you want to buy costs more than $800k, you’ll need more than a 5% deposit.


Here’s an example of the repayments for a Launchpad loan for a $800,000 home, bought with a 5% deposit of $40,000.


Loan Amount


Monthly repayment









Total Loan




NB: Repayments based on a 5-year term at the interest rate specified. This is a hypothetical example only. Interest rates are subject to change.

Launchpad vs. renting and saving: how does it stack up?

When looking at the monthly repayment in the above example: $4142, it can appear a bit steep. It works out at $956 per week. That compares to average weekly rents of around $600 per week in both Wellington and Auckland.

But you have to remember that $588 of that weekly amount comprises the equity loan. The base part of the loan, in the example above, works out to $368 per week.

If you pay off the equity loan each month, that part of your repayment will disappear within five years. Faster if you manage to make extra payments.

In the example above, the equity loan over five years costs $32,820 in interest payments. Over the same period, if the home increases in value by just over 4%, it will make back the costs of the loan. And even if the price of the home remains static – the owner will still have $160k equity (20%) in an $800k property.

Who and what type of homes are eligible for Launchpad?

Rather succinctly, the Squirrel website claims that: “if you’re buying within 10km of a Macca’s and it’s not a lifestyle block, the property is likely to be eligible location-wise.”

And, when it comes to who is eligible for Launchpad, again, it’s a pretty broad sweep of prospective first home buyers:

  • First home buyer
  • 5% saved deposit (includes KiwiSaver)
  • On PAYE or a self-employed contractor for at least a year
  • Intending to live in the property
  • Buying in a metro location

If you think that Squirrel’s Launchpad could be a good fit for your budget and first home aspirations, you can find out more about it here, by clicking through to Squirrel’s website. Or to compare a wide range of different mortgages and lenders with Canstar, just click on the button below.

Compare home loan rates for free with Canstar!

Enjoy reading this article?

You can like us on Facebook and get social, or sign up to receive more news like this straight to your inbox.

By subscribing you agree to the Canstar Privacy Policy

Share this article