Big Changes in Place for First Home Buyers, What It Means for You.
Buying your first home is one of life’s biggest milestones, but it can also be confusing. The government’s First Home Guarantee Scheme has been revamped, with key changes that came into effect from 1st October. These are not brand new measures, but rather necessary updates to the existing scheme that remove income thresholds and increase property price caps. The aim is to make the process simpler and open the door to more potential buyers.
Here is what is changing
Smaller deposit needed
Usually banks ask for a 20 percent deposit to avoid extra fees. On a 600,000 dollar home, that is 120,000 dollars.
From 1 October you only need a 5 percent deposit. On that same 600,000 dollar home, that is 30,000 dollars instead of 120,000 dollars. That is a game changer for anyone who has been struggling to save.No extra bank fee if your deposit is under 20 percent.
Normally if you do not hit 20 percent, the bank charges Lenders Mortgage Insurance. It protects the bank, not you, and it can cost many thousands. Under this scheme you do not pay it, which means money saved up front.
More people can now apply
The old income cap is gone. If you are earning decent money but have found saving a deposit hard, you can still be eligible.
Higher property price limits
The maximum property prices the scheme will cover have increased. More houses, units and townhouses are now included, which helps in areas where prices have moved quickly.
What this means for you
You do not need to save as much
You avoid a big upfront fee
More homes are available
More people qualify
If you have been sitting on the sidelines because buying felt out of reach, now could be your moment.
Tip: You will still need to allow a small buffer for other upfront costs such as conveyancing, pest and building inspections, and adjustments. We generally recommend clients allow around $3,000 to $4,000 dollars in addition to their deposit.
Other first home pathways still available, talk to our specialists
The update above sits alongside several existing programs that can also help first home buyers. Our First Home Buyer specialists can review your situation and explain which options fit best.
Quick summary
First Home Buyers Assistance Scheme FHBAS
State based transfer duty concessions and exemptions for eligible first home buyers, subject to price caps and occupancy rules. This can reduce or remove stamp duty and improve your overall budget.
First Home Super Saver Scheme FHSSS
Lets you make voluntary contributions to your super, then withdraw eligible amounts to boost your deposit. It can be a tax efficient way to save faster.
Family Home Guarantee FHG, 2 percent deposit
For eligible single parents and single legal guardians, not limited to first home buyers. Buy with as little as a 2 percent deposit without paying Lenders Mortgage Insurance due to a government guarantee.
First Home Owner Grant for New Homes FHOG and similar state incentives
Grants for building or buying a new home. Eligibility, amounts and property criteria vary by state and territory.
How to get started
Every buyer’s situation is different. A broker can help you work out:
Whether you qualify
How much you can borrow
Which lenders participate
The best way to structure your application
Buying your first home does not have to feel impossible. With these changes and the other programs still available, more Australians can finally get into the market.
Why choose Broker Bros
Our specialists will match you with the right lender and the best possible package for your needs. We focus on giving you the highest chance of getting a yes, whether your plan is short term or long term. Think of us as being in your corner. We will work alongside you the whole way through, from the first chat to getting your keys.