A Guide to Gov’t Home Buyer Assistance

In the light of Australia’s ongoing housing crisis both federal and NSW governments have unveiled assistance packages and grants to help first-time buyers to get into the market. There are additional schemes aimed at single parents or those living in regional areas.

Some of these schemes provide financial guarantees reducing the size of your home deposit, others exempt buyers from having to pay transfer fees – while the First Home Owner (New Home) Grant is a one-off $10,000 payment towards the cost of a newly built house or apartment.

Confusion arises because these grants and schemes are administered separately by Housing Australia and the NSW Government. In addition, some programs were only available for limited time and have expired; others have been upgraded or expanded over time.

This article provides an overview of what’s currently on offer – but it’s always advisable to do further research and if in doubt speak to your conveyancer or solicitor for professional guidance.

In December 2024 federal parliament approved an ambitious Help to Buy scheme which is designed to help low- and middle-income earners to enter the property market.

Under the scheme, which has not yet come into force in NSW, the federal government will give participants an equity contribution of up to 40% of the cost of a new home and 30% of an existing home. [1]

According to the Guardian buyers must contribute at least a 2% deposit. The scheme is administered by Housing Australia, with numbers capped at 10,000 places a year and 40,000 places over four years.

The final shape of the Help to Buy scheme will depend on the outcome of the May 3 federal election – with applications for the scheme expected to open towards the end of 2025. [2]

Current list of available grants & schemes

Home Guarantee Scheme (HGS)

The Home Guarantee Scheme (HGS) is a federal government initiative designed to support eligible home buyers to buy a home sooner. It is administered by Housing Australia

The Scheme includes three types of Guarantees:

• First Home Guarantee (FHBG) – supporting eligible home buyers to buy a home sooner with a deposit as little as 5%
• Regional First Home Buyer Guarantee (RFHBG) – supporting eligible regional home buyers to buy a home sooner with a deposit as little as 5%
• Family Home Guarantee (FHG) – supporting eligible single parents and eligible single legal guardians of at least one dependent to buy a home sooner, with a deposit as little as 2%.

Housing Australia works with participating lenders to facilitate loans to eligible home buyers who meet income eligibility thresholds but don’t have the 20% deposit typically required for a home loan. Participating lenders include major banks such as NAB, Westpac and Commonwealth Bank, plus non-major bank lenders including Bendigo Bank, IMB Bank and Newcastle Permanent. Once approved, Housing Australia provides a guarantee of up to 15% of the value of a home loan under the First Home Guarantee or the Regional First Home Buyer Guarantee; and up to 18% under the Family Home Guarantee. This enables an applicant to buy a home without paying Lenders Mortgage Insurance. Each type of guarantee has its own unique eligibility criteria. Click here to read more.

First Home Guarantee (FHBG)

The First Home Guarantee (FHBG) is an Australian Government initiative to support eligible home buyers to buy a home sooner. It is administered by Housing Australia. Under the FHBG, part of a home buyer’s home loan from a participating lender is guaranteed by Housing Australia. This enables a home buyer to buy a home with as little as 5% deposit without the need to pay Lenders Mortgage Insurance. FHBG can be used for several types of property, including off-the-plan apartments.

Eligibility criteria

To apply for the FHBG, home buyers must be:

• an Australian citizen or permanent resident
• at least 18 years of age
• earning up to $125,000 for individuals or $200,000 for joint applicants
• intend to be owner-occupiers of the purchased property
• First-home buyers or previous homeowners who haven’t owned or had an interest in an Australian property in the past 10 years.

FHBG is not a cash loan or a deposit. Property price caps apply – the current price cap for Sydney is $900,000. Click here to read more.

Family Home Guarantee (FHG)

The Family Home Guarantee (FHG) is a federal government initiative to support eligible single parents or eligible single legal guardians of at least one dependent to buy a home sooner. It is administered by Housing Australia. Applicants can be first home buyers or previous homeowners.

Eligibility criteria

To apply for the FHG, home buyers must be:

• applying as an individual
• a single parent or single legal guardian of at least one dependent
• an Australian citizen or permanent resident at the time they enter the loan
• at least 18 years of age
• earning no more than $125,000 a year
• intending to be the owner-occupier of the purchased property
• not currently owning property, or upon settlement of the guaranteed property, not intending to own a separate property.

Under the FHG, part of an eligible home buyer’s home loan from a participating lender is guaranteed by Housing Australia. This enables an eligible home buyer to purchase a home with as little as 2% deposit without paying Lenders Mortgage Insurance. Applicants therefore need to have between 2% and 20% of the value of an eligible property saved as a deposit. The minimum deposit required for the FHG is 2%, but participating lenders may require a higher percentage deposit based on individual financial circumstances. Click here to read more.

First Home Buyers Assistance Scheme (FHBAS)

Eligible first-home buyers in NSW purchasing a property for $800,000 or under qualifies for a full exemption from transfer (stamp) duty. Anyone who buys a property worth between $800,000 and $1 million will pay a reduced rate of transfer duty, depending on its value.

Eligibility criteria

To be eligible for the program, you must be:

• 18 years or over
• an Australian citizen or a permanent resident of Australia
• purchasing your first home
• planning to live in the home for 12 months.

If you believe that you qualify for this scheme speak to your conveyancer or solicitor who can assess your application. Click here to read more.

First Home Owner (New Home) Grant

The NSW Government provides one-off grants of $10,000 for the purchase of new or substantially renovated homes in NSW, including apartments bought off-the-plan. Grant are only available for homes that no-one has lived in before. A price cap of $600,000 applies for newly built houses, townhouses or apartments.

Eligibility criteria

To be eligible for the program, first home buyers must be:

• 18 years or over
• an Australian citizen or a permanent resident of Australia
• purchasing their first home
• planning to live in the home for 12 months.

People can apply for the First Home Owner (New Home) Grant through their bank or financial institute. Grants are not means tested and you do not have to pay tax on the grant. Click here to read more.

Sources:
[1] ABC
[2] The Guardian

If you would like more information about any of these government assistance packages or to learn more about one of our exciting projects, get in touch with the ALAND Sales Team on 1800 025 263 or fill out your details below.

Disclaimer:
The information contained in this article is general in nature and does not constitute financial, legal, or professional advice. It is provided for informational purposes only. Government policies and programs, including first home buyer grants and assistance schemes in New South Wales are subject to change without notice. Prospective buyers and investors should seek independent advice and conduct their own due diligence based on their individual circumstances. While all reasonable care has been taken in preparing this article, we expressly disclaim any liability for any loss or damage arising from reliance on the information contained herein, to the extent permitted by law.