There are several Government First Home Buyers assistance schemes by The Federal Government and Victorian Sate Government. The scheme ENDS JUNE 2025 with no indication it will be renewed.

The ‘Help to Buy’ scheme, a federal shared equity program, is set to launch on 1st January 2026. It provides eligible first home buyers with an equity contribution from the government, ranging from 30% for existing homes to 40% for new builds. 

Key Features

  • Equity Contribution – The government will contribute 30% of the purchase price for existing homes and up to 40% for new builds. 
  • Lower Deposits – Buyers only need to contribute a 5% deposit. 
  • Reduced Mortgages – The government’s equity contribution means a smaller mortgage, potentially leading to lower monthly payments. 
  • Income Tests – There are income caps for eligibility, with individual applicants needing to earn less than $100,000 and joint applicants earning less than $160,000. 
  • Property Price Caps – There are property price caps in place, which vary across Australian regions. 

How it works

  • Eligible first home buyers can apply for the scheme to purchase an existing or new home. 
  • The government will take a share of the equity in the property, according to their contribution. 
  • The buyer will need to repay the government’s share of the equity, either over time, or when the property is sold. 
  • Applications for the scheme are expected to open later in 2025. 

The proposed Home Buyers Guarantee Scheme (HGS) by the Federal Government would eliminate the need for Lenders Mortgage Insurance (LMI) for the vast majority of home buyers.

However, the need for LMI offers a broader solution, where it can be useful for borrowers who do not qualify under government schemes.

In simple terms, the expansion of HGS will have the effect of shifting a substantial portion of mortgage default risk from the private sphere (the various lender mortgage insurance companies) to a taxpayer- backed scheme that offers a narrower protection.  

For further details on these scheme and how you can benefit, talk to Paul today.

 

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