ISCOVER
The MFAA and FBAA have welcomed the eagerly awaited expansion of the Home Guarantee Scheme, with the start date brought forward and property price caps increased.
The broking industry has praised the Albanese government’s decision to bring forward the start of the First Home Guarantee Scheme to 1 October 2025, three months earlier than originally planned.
The government had planned to expand the scheme from 1 January 2026, giving all eligible first-home buyers access to a 5 per cent deposit guarantee with no income or place caps. The universal guarantee was a key election promise.
However, the start date has now been brought forward to 1 October, when all Australian first home buyers with a 5 per cent deposit can apply for the scheme, while property price caps will also be lifted.
The new property price limits are as follows:
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NSW – capital city and regional centre: current limit $900,000 → new limit: $1,500,000
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NSW – other: $750,000 → $800,000
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VIC – capital city and regional centre: $800,000 → $950,000
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VIC – other: $650,000 → no change ($650,000)
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QLD – capital city and regional centre: $700,000 → $1,000,000
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QLD – other: $550,000 → $700,000
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WA – capital city: $600,000 → $850,000
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WA – other: $450,000 → $600,000
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SA – capital city: $600,000 → $900,000
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SA – other: $450,000 → $500,000
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TAS – capital city: $600,000 → $700,000
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TAS – other: $450,000 → $550,000
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ACT: $750,000 → $1,000,000
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NT: $600,000 → no change ($600,000)
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Jervis Bay Territory and Norfolk Island: $550,000 → no change ($550,000)
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Christmas Island and Cocos (Keeling) Islands: $400,000 → no change ($400,000)
The government has changed the price caps after noting that the median home price in Australia today is $844,000, meaning a 5 per cent deposit equals $42,200. It said that the last time $42,200 was enough to cover a 20 per cent deposit for a median home was in 2002 — highlighting the generational scale of the change.
According to the government, the expanded scheme will allow a first home buyer in Brisbane to purchase a $1 million home with a $50,000 deposit; cutting up to 10 years off the time it takes to save for a deposit, save about $42,000 in mortgage insurance, and enable buyers to put up to $350,000 towards their own loan instead of paying rent.
There will also be changes to simplify access to the scheme in regional areas, with the Regional First Home Buyer Guarantee set to be replaced by the First Home Guarantee.
The government also pledged to add more lenders to the expanded Home Guarantee Scheme.
Announcing the new start date on Monday (25 August), Prime Minister Anthony Albanese said: “We want to help young people and first home buyers achieve the dream of home ownership sooner.
“Bringing the start date of our 5 per cent deposit scheme forward will do just that.
“Getting more Australians into their own home quicker, while saving them money along the way.
“Labor was re-elected with a clear mandate to bring down the deposit hurdle for first home buyers, and we’re delivering.”
Since coming to office in 2022, Labor has reportedly helped over 180,000 first-home buyers get a home of their own with a lower deposit. On average, there have been 6,000 more first-home buyer loans a year.
In just the first year alone, first home buyers using the scheme are expected to avoid paying around $1.5 billion in potential mortgage insurance costs.
Minister for Housing, Clare O’Neil, said: “5 per cent deposits for all first home buyers will mean people can get into their own home sooner.”
“The Albanese Labor Government is stepping up to level the playing field and back a new generation of first home buyers into the housing market.”
“It’s just not right that an entire generation of young Australians has been locked out of the housing market – saving for decades while paying off someone else’s mortgage. So Labor’s changing it.”
Industry welcomes HGS changes
Finance Brokers Association of Australia (FBAA) managing director Peter White welcomed the reforms.
“This decision will put more younger Australians within reach of realising their home ownership dreams.
“It's good news for borrowers and good news for brokers, who will be best placed to assist first-time buyers through the process, and ensure they have a product suited to their needs,“ he added.
“While this is an important part of the equation, there are other crucial elements to improving affordability that also need attention, including bringing on more housing supply,“ White finished.
Commenting on the reforms, Matt Dawson, National Australia Bank (NAB) executive for home ownership, said the changes were timely for aspiring buyers.
“We back these further measures, such as removing barriers like income caps and uncapping the number of places available – making the scheme available to all Australian first-home buyers.
“The reality is many people assume they can’t buy a home because they don’t have a 20 per cent deposit. The scheme shows that homeownership can happen much sooner than expected,“ he added.
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