From 1 October 2025, the Australian Government is expanding its Home Guarantee Scheme. The changes will make it easier for first home buyers to enter the property market, thanks to lower deposits and broader eligibility.
The Home Guarantee Scheme (HGS) helps eligible Australian first home buyers buy a home sooner by supporting buyers with a deposit of as little as 5 per cent without the need for Lenders Mortgage Insurance (LMI).
Changes for the better
From 1 October 2025, several key updates will apply:
- No limits on places: All eligible first home buyers can apply.
- No income caps: Buyers with higher incomes will have access to the Scheme.
- Higher property price caps: Reflecting today’s housing market, the maximum property value has increased across most states. For example, in New South Wales capital cities and regional centres, the cap will rise from $900,000 to $1,500,000.
- Simpler regional access: The Regional First Home Buyer Guarantee will be replaced with the broader First Home Guarantee.
What this means for you
In short, these updates are designed to give more Australians the opportunity to secure their first home.
Instead of having to wait until you have saved a 20 per cent (pc) deposit, you only need to have a 5 pc deposit saved. This means you can start your purchase journey, and move, sooner.
LMI is a one-off payment for insurance that protects the lender, should you default on your payments. It’s generally added to the principal of your loan, so you end up paying interest on it, throughout the life of your loan. By underwriting your loan and removing the need for LMI, the Home Guarantee Scheme is not only saving you the cost of the LMI, but also interest across the life of your loan.
By increasing the property price caps, you have a better chance of breaking into the ever-increasing property market. For a full list of the new property price caps by location, refer to the table below.
| Location | New price cap | Location | New price cap |
|---|---|---|---|
| NSW-capital city & regional centre* | $1,500,000 | South Australia - capital city | $900,000 |
| NSW - other | $800,000 | South Australia - other | $500,000 |
| Victoria - capital city & regional centre* | $950,000 | Tasmania - capital city | $700,000 |
| Victoria - other | $650,000 | Tasmania -other | $550,000 |
| Queensland - capital city & regional centre* | $1,000,000 | Australian Capital Territory | $1,000,000 |
| Queensland - other | $700,000 | Northern Territory | $600,000 |
| Western Australia - capital city | $850,000 | Jervis Bay Territory & Norfolk Island | $550,000 |
| Western Australia - other | $600,000 | Christmas Island & Cocos (Keeling) Islands | $400,000 |
* Regional centres are (1) in New South Wales - Illawarra, Newcastle and Lake Macquarie, (2) in Victoria - Geelong, and (3) in Queensland - Gold Coast and Sunshine Coast.
Eligibility
Understandably, eligibility criteria applies to access the Scheme. Here is a summary of eligibility criteria:
- Age: applicants must be at least 18 years of age
- Citizenship: the scheme is available to eligible borrowers who are Australian citizens or permanent residents at the time they enter the loan.
- First home buyer: you must be a first home buyer or provide proof you have not owned or held interest in property in Australia in the past ten years.
- Individual or joint applications: You can apply as an individual, or any two eligible people may apply together, including friends, siblings or other family members.
- Owner occupied: you need to move into the property within six months of owning your home and continue to live in that property for as long as your home loan has a guarantee under the Scheme.
Find out more
The Scheme is available through more than 30 participating lenders, including major banks, regional banks, and customer-owned institutions. Note: you cannot apply direct to Home Australia.
If you’re considering your first home purchase and want to discuss finance options, our brokers will work with you to establish your goals, then work with participating lenders to find a solution that fits your situation. Please note: you will still have to meet all the lender's loan criteria.
Complete the form below now to explore your home loan options.
References: Housing Australia media release 24 August 2025
Disclaimer: Brokerage services provided by Elders Home Loans Pty Limited (ABN 22 118 064 654; Australian Credit Licence 384408) or its authorised credit representatives. Lending criteria apply. Not all products of all lenders may be offered.