First Home Guarantee: What’s Changing From October 1?
Q: What is the First Home Guarantee?
A: It’s a government scheme that helps first home buyers purchase a property with as little as a 5% deposit. The government acts as guarantor for 15% of the loan, so buyers can avoid paying Lender’s Mortgage Insurance.
Q: What’s new and when does it start?
A: The expansion of the scheme will now start on 1 October (instead of next year).
Q: What are the main changes?
- No more income limits to apply.
- No cap on the number of places in the scheme.
- Property price limits have been increased (up to $1.5 million in Sydney, $1 million in Brisbane and Canberra).
Q: How many people could benefit?
A: Treasury predicts up to 70,000 first home buyers could enter the market thanks to the changes.
Q: Will this affect property prices?
A: Treasury modelling suggests prices may rise by about 0.5% over six years due to extra demand.
Q: What do experts think?
- Property Council of Australia: Welcomed the fast-tracking, saying more support is needed as the average age of first home buyers is nearing 40.
- Real Estate Institute of Australia: Called it a “timely and practical” step, noting the higher price caps and removal of income limits make it fairer for buyers.
- Both groups stressed that while the scheme helps buyers, more housing supply must be added to tackle affordability in the long term.
Q: Will the scheme be reviewed?
A: Yes. From 1 July 2026, the government will review the scheme regularly to ensure housing markets don’t overheat and that the scheme continues to meet its objectives.