Help to Buy Scheme to help more Australians into their own home

Thousands of Australians locked out of home ownership will have the opportunity to buy their own home with the launch of the Albanese Government’s Help to Buy Scheme on Friday 5th December.

While the Government is laser focused on increasing the supply of housing in Australia, we won’t tell a generation of low- and middle-income Australians locked out of home ownership that there’s no help on the horizon.

Help to Buy will support up to 10,000 eligible low-and middle-income first home buyers a year, with the Government contributing up to 40 per cent for new homes and 30 per cent for existing homes in exchange for an equity share of the property.

The higher equity share for new homes reflects the Government’s focus on ensuring our policies support the building of new homes wherever possible.

Under the scheme, participants will need to save a minimum 2% deposit and obtain a home loan from a participating lender. Once the home is purchased, participants will need to maintain the home and keep it insured.

The scheme helps address two major hurdles to homeownership. It will cut years off the time it takes to save for a deposit, while vastly reducing the size of the mortgage buyers take on reducing their monthly repayments.

Income caps are $100,000 for individuals and $160,000 for joint applicants and single parents.

The Government’s equity stake will be repaid through either voluntary repayments, when a participant has the financial capacity to buy back the Government’s equity, or when the property is sold.

Here’s how the scheme would work for a typical participant:

·         Jess is an individual applicant earning $90,000 a year who bought an established home for $600,000 through Help to Buy. The purchase involved:

o   $12,000 deposit from Jess

o   $408,000 loan from Jess’ participating lender

o   $180,000 Government contribution (30 per cent).

As a result of Help to Buy:

·         Jess repays a $408,000 loan over 30 years to her lender.

·         Jess' repayment of the Government 30 per cent equity share ($180,000) will happen through either:

o   voluntary repayments

o   when Jess has the financial capacity to buy back the Government’s equity

o   when Jess sells the property.

The Commonwealth Bank of Australia and Bank Australia are the first lenders to operate the scheme, with more lenders to come onboard in 2026.

From 5 December, Help to Buy will be available in New South Wales, Victoria, Queensland, South Australia, the Northern Territory and the Australian Capital Territory. The scheme will operate in Western Australia in early-to-mid 2026. The Tasmanian Government has decided not to operate the scheme at this stage, instead monitoring the roll-out while continuing to administer existing schemes.

Australians are still doing it incredibly tough on housing. But under this Albanese Labor Government, we have brought the Commonwealth back to the table after a decade of Coalition neglect, with the most ambitious housing agenda since the post war era: $43 billion to build more homes, get renters a better deal and more Australians into home ownership.

For more information on Help to Buy visit firsthomebuyers.gov.au.

Quotes attributable to Minister for Housing, Homelessness and Cities:

“I’ve got a pretty simple belief – that ordinary Australians should be able to buy their own home, and that’s what Help to Buy is about.

“This will open up home ownership to 10,000 ordinary, working Australians each year who might otherwise be locked out – retail workers, cleaners, and aged carers workers and nurses just to name few.

“While we’re resolutely focused on increasing housing supply, I’m not going to tell a generation of working Australians who are locked out of housing that there’s no help on the horizon. There is, and Help to Buy will make a difference.”