The Australian Government has introduced a suite of changes designed to help more people enter the property market sooner.
For many Australians, owning a home remains one of life’s most significant financial goals.
Yet in recent years, rising property prices and the challenge of saving for a deposit have made that dream feel further out of reach.
The Australian Government 5% Deposit Scheme has been expanded. Picture: Getty
Recognising the challenges facing first home buyers, the Australian Government recently expanded the Australian Government 5% Deposit Scheme, formerly called the Home Guarantee Scheme, and launched the new Help to Buy Scheme.
Here is what’s changed, what’s new and how these schemes could help you buy your first home sooner.
Australian Government 5% Deposit Scheme
The Australian Government 5% Deposit Scheme is designed to help eligible buyers purchase a home with as little as 5% of the property value saved. There is also the single parent stream, where you can buy with as little as a 2% deposit.
So, for example, if you’re purchasing a home worth $600,000, you’ll only need a deposit of $30,000, instead of the usual $120,000 required for a 20% deposit while also needing to pay Lenders Mortgage Insurance (LMI).
LMI, is the premium lenders normally charge, when a borrower’s deposit is less than 20% of the property’s value.
Under the 5% Deposit Scheme, the Australian Government will guarantee a portion of a first home buyer’s home loan, so you can purchase with a lower deposit and not pay LMI.
For a $600,000 house, that’s a further saving of almost $24,000 in LMI costs.
This scheme could make a significant difference for buyers who’ve been steadily saving but struggling to reach the traditional 20% deposit.
By removing the upfront LMI cost, it also helps reduce upfront expenses and accelerates the pathway to home ownership.
What has changed in the scheme?
Since October 2025, the scheme has undergone several key changes to broaden its accessibility:
- Income caps removed: There are no longer income restrictions, which means all first home buyers, no matter what they earn are now eligible
- No cap on number of places: Previously, the number of scheme places that could be taken up were limited each year. That restriction has now been lifted, meaning eligible home buyers can apply at a time that is right for them
- Property price caps increased: This change allows buyers to consider a wider range of homes, including in areas where property values have risen in recent years
By removing income and place limits makes the scheme far more accessible for everyday Australians: from couples and families to friends buying together.
Single parents and single legal guardians can buy a home with as little as 2% deposit. Picture: Getty
There is also a separate stream for single parents or single legal guardians where you can buy with as little as a 2% deposit.
New Help to Buy Scheme now open
The Help to Buy Scheme, opened for applications on 5 December 2025.
Help to Buy is designed to support those who are locked out of home ownership.
This scheme is a new initiative where the Australian Government contributes a portion of the purchase price for eligible home buyers.
For new homes, the Government can contribute up to 40% of the purchase price.
For existing homes, the contribution could be up to 30%.
In return, the Government retains a proportional equity stake in the property, which the buyer can choose to repay over time or when the home is sold.
Buyers must contribute a minimum deposit of 2% and meet certain eligibility criteria such as income and property price caps.
The scheme aims to assist up to 40,000 Australian households over four financial years.
Impact for first home buyers, single parents and regional buyers
Home ownership is about more than buying a house: it’s about security, stability, and a sense of belonging.
These schemes have been designed with broad accessibility in mind. Whether you’re living in a major city or a regional town, these initiatives may apply to you, as long as the home you’re buying falls within the relevant property price cap.
This means, all first home buyers and single-income households, including single parents and legal guardians with dependents, may be eligible for specific streams of support under the 5% Deposit Scheme or Help to Buy Scheme.
Where to start?
To help future home buyers, the Government has launched a new one-stop website: firsthomebuyers.gov.au.
Before you begin looking at homes, make sure you understand each scheme and their eligability. Picture: Getty
The site brings together information on the schemes available and offers practical tools, including:
- A 5% Deposit Scheme eligibility checker and property price tool
- A Help to Buy eligibility checker and property price tool
These tools are designed to help you quickly understand which schemes you may be eligible for and guide you through the next steps, such as finding a Participating Lender.
Visit firsthomebuyers.gov.au to check your eligibility and take the first step toward owning your own home.
Authorised by the Australian Government, Canberra
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