That Home Loan Hub
Welcome to That Home Loan Hub, your ultimate guide to mastering the world of home loans and property. I'm Zebunisso Alimova, here to simplify the complexities of real estate and provide you with expert insights and the latest trends.
Whether you're a first-time homebuyer, an experienced investor, or simply curious about the property market, this podcast is for you. Join me each week as we unlock the secrets to property success and help you make informed decisions. Let's dive into the world of property together!
That Home Loan Hub
How To Buy Your Parents’ House With Gifted Equity
Want a faster, cleaner path onto the property ladder without scraping together a 20% cash deposit? We dive into the growing strategy of buying your parents’ home at market value while using gifted equity to supercharge your approval odds, cut low‑equity costs, and keep the whānau home in the whānau. Across a real‑world $1m valuation scenario, we walk through how a $600k sale price to the kids, plus a $50k KiwiSaver withdrawal, translates into a bank‑friendly deposit position that makes sense on paper and in practice.
We talk through the nuts and bolts: why you must stick to the registered valuation to protect comparable sales, how a deed of gift documents the equity transfer, and what lenders expect for private related‑party deals. If the phrase “gifted equity” sounds like magic money, we break down the paperwork and the risk controls so it all clicks. You’ll hear how stronger equity from day one can open sharper rates, better cash‑back offers, and a clearer runway to your next purchase. Multi‑generational living is a bonus, not a barrier—parents nearing retirement can cash out, kids can step up, and everyone keeps roots where they matter.
We also broaden the lens beyond family: long‑term tenants buying from landlords can use a similar structure at market value, backed by a clean valuation and legal process. Whether you’re a first‑home buyer with KiwiSaver, parents planning a graceful exit from the mortgage, or a tenant who’s treated the place like your own, this approach can align hearts and numbers. If you’re ready to map your figures, we can model the valuation, the gift, and the loan so you know exactly where you stand.
If this helped, follow the show, share it with someone who needs a clearer path to ownership, and leave a quick review so others can find us. Got a scenario you want us to run through next time? Send it our way and we’ll break it down.
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Bula vinaka! Zibonisa is back from PG and Zibonisa wants to talk to you about something really exciting. Nah, she won't. Cunch will. Hey Kunch.
SPEAKER_01:I didn't have anything exciting to go. Bulavinaka. Bula vinaka.
SPEAKER_00:Did you know vinaka also is thank you? Thank you, yeah. That was so cool. Like we're walking around and the same words.
SPEAKER_01:Yeah, it's so cool when you go overseas and then you're using your their language and stuff like that. Like, I love doing that. Like, I don't know if you um been to Hawaii, but Hawaii is the same. It's like Aloha. That's what James says all the time on the podcast.
SPEAKER_00:Aloha. It is Mahalo. So uh we've seen a trend. Yes. Especially you. You've seen the trend. So in the last seven and a half years of me running this business, I probably have done two or three of those deals. Yeah. In the last nine months of you working here, you've done four or five. Yeah. So let's demystify what you are doing and how how does it work? And what are we actually talking about?
SPEAKER_01:Yeah, so I thought about thought we'll cover off family buyout or like fam buying the family home from your parents and your parents gifting you the equity.
SPEAKER_00:Okay, so buying off family.
SPEAKER_01:Yeah. So I've had a few people come through my desk at the moment, whereas they're still living with mum and dad, and mum and dad are nearly at retirement, so they they kind of just don't want a home loan anymore, sort of thing. So they want to cash out. Yeah, so they want to cash out, and the kids are still there at home. Kids are working full-time, they've got the ability to do it, they've got Kiwi Saver, things like that, and they still want to stay in their family home. Cute. Very cute. But there's all they're also there with, you know, their family as well. So yes, they've got family, but there's enough room for them. It's a multi-generational living. Yeah. Yeah. So there's enough room for them there. So now they're like, well, we want, yeah. Parents want to cash out, children want to help parents. So what better way is to sell the property to your children and keep that family home within the family. Yeah. So I've had a lot of that. So the good the beauty of that is when you're purchasing off your parents, you get the equity gifted to you, which then means you don't have to have a 20% deposit. 10% is generally the minimum in terms of the deposit side, but having that equity gifted means that it's a lot easier for you to get an approval through the bank because you've got a lot more equity in the property.
SPEAKER_00:And this is where a lot of people get confused. They're like, oh, what is this equity? You know, how does it work? And this is where we say we sit down with you and we show you in real numbers how it works. Yeah. It's really hard to relay that information on the podcast. Yeah. So we're going to keep it mysterious and we're going to get them to get in touch with us to show them. But we just wanted to let you know it is possible. It is definitely possible.
SPEAKER_01:And it's the quickest and easiest way to actually buy a house.
SPEAKER_00:Yeah. I reckon. And it makes your application so much more appealing to the bank and puts you in a much more favorite position in terms of interest rates and cash back. Yeah.
SPEAKER_01:Yeah. Definitely a stronger position with more of a deposit side of thing in terms of that equity. So you weren't going to do the numbers. I was just going to cover off some numbers a little bit for our clients. Just like, you know, a hypothetical uh right. Give us a hypothetical. Okay. Hypothetical. Oh my god. I butchered that. But anyway, you guys know. So the home is worth, let's say, a million dollars. Okay. Based on the registered valuation. Uh-huh. Your parents agree to sell to you, or they want from you, say$600K. Right? They're so loving. So loving. So they want you to give them$600,000. And then so obviously you need to approach the bank or the lender or us approach it for you to get you$600,000. Let's say you've got$50,000 in your Kiwi Saver and you haven't owned a home before, you can pull out your Kiwi Saver for that. So then you're approaching the bank for$550. Correct.$550. So in that sense, the house is worth a million dollars. You've got a$550 loan. The equity your parents is gifting you is$450.
SPEAKER_00:No,$400.$450.$400 because$50K is coming from QBSaber.
unknown:Okay.$400.
SPEAKER_01:$400. Yes. Yeah. So you'll yeah, your parents have gifted you$400,000 in the value of that property.
SPEAKER_00:And this is, I think, where a lot of people's brain breaks because like, but I don't see this equity. How does it work, you know? And what is this mysterious money? And it's sort of like money in the ear. Correct. So instead of devaluing the house, because this is the last thing you want to do, you do not want to devalue the house. You do not want to sell it at 600 if it's worth 1 million. Correct. Because you're affecting not just your house, but everyone on your streets. Correct. So we're not doing anything dodgy at all. We are keeping it with the market. Yes. But the reason they're giving you an equity gifted is because they love you. And also because maybe they will be living there for free. Correct. So it's sort of like they're buying ahead, you know, they they're paying you ahead with this equity. So there is nothing dodgy. And it's really interesting how some of the lawyers haven't come across those concepts.
SPEAKER_01:Yeah.
SPEAKER_00:And I mean, we've been doing it for years. And I still come across lawyers that go, this is very unorthodox.
SPEAKER_01:But it's not, because most lenders, as well as if you're buying as a private sale, it would be a private sale because it's between you and mum and dad. You actually need to get a registered valuation. Like one of the requirements is actually get a registered valuation.
SPEAKER_00:So we can see what it's actually working on the market. Correct. Yeah. So this is where we start. And the good thing about you know us, and what we've we've done so many of them. Like I've done heaps in the bank, you know, and in in this scenario, but we also do it with landlords. I had one recently where the tenants stayed in the same house for 10 years, and we've done very similar scenario with the landlords. So it works in a family scenario, but also if you want to buy a place that you rent your landlord of your landlord. Yeah. Yeah. So please reach out. This is the fastest way to get you on the letter. Yeah. And then it creates instant equity for you to then go and buy an investment property as well. Yep. Yeah. It's actually a cool thing to do. Yeah, absolutely. We've got three of them live at the moment. Awesome. Conch, thank you so much for coming in. I'll see you next time. Thank you. Bye. Bye.
