The Government has increased the amount of money first-home buyers can borrow under the Welcome Home Loan scheme.
The increase to $350,000 is aimed at helping people buy properties in higher priced areas.
Housing Minister Phil Heatley says for years now, prices in some areas have been well above the scheme's former limit.
The new amount will be available only in more expensive areas, including Auckland, Wellington and Queenstown.
But Quotable Value figures put the average house price in the Auckland region at more than $500,000.
Mr Heatley says having a higher limit could entice people into debt they cannot afford.
Meanwhile, the Cabinet has committed to underwriting loans for building on multiple-owned Maori land where banks have been reluctant to lend.