February 6, 2026
First Home Buyer Scheme 2025: How it can help you own a home sooner
Buying a
first home is a significant milestone, yet it can also be one of the most challenging
financial steps for many
Australians. With property prices steadily increasing, and traditional deposit requirements often set at 20% of the home’s value, entering the housing market can feel out of reach. To support aspiring homeowners, the Australian Government came up with
First Home Guarantee (FHBG) scheme to help Australians enter the housing market with lower deposits.
What is the First Home Buyer Guarantee Scheme?
It is a program that helps eligible first home buyers buy a home with a small deposit—as little as 5% of the property’s value.
Normally, if you have a deposit under 20%, you have to pay for Lenders Mortgage Insurance (LMI)- and extra cost that can be quite expensive. With the First Home Buyer Scheme, the government steps in and guarantees part of your loan. This means you can avoid paying LMI altogether, saving you thousands of dollars upfront.
Significant changes from 1 October 2025
Starting October 2025, the scheme will become more accessible and much easier to use.
No More Income Limits: It means more people, regardless of their income, can apply for the scheme.
No Limit on Places: Previously, the scheme had a cap on the number of people who could access it each year. That cap is now being removed — meaning if you’re eligible, you can get a place..
Lower Deposit Requirement: Eligible buyers can purchase with just a 5% deposit, with the government acting as guarantor for the remaining 15% thus removing the need for costly Lenders Mortgage Insurance (LMI).
Higher Price Caps: The maximum property under the scheme will be increased. Since home prices have risen, this change gives you more options — especially in major cities where affordability is toughest.. The new price limits will be different for each state.
| Location |
Current Property Price Cap |
Property Price Cap effective 1 October 2025 |
Minimum 5% Deposit Required for Upper Price Limit |
| NSW – capital city and regional centre |
$900,000 |
$1,500,000 |
$75,000 |
| NSW – other |
$750,000 |
$800,000 |
$40,000 |
| VIC – capital city and regional centre |
$800,000 |
$950,000 |
$47,500 |
| VIC – other |
$650,000 |
$650,000 |
$32,500 |
| QLD – capital city and regional centre |
$700,000 |
$1,000,000 |
$50,000 |
| QLD – other |
$550,000 |
$700,000 |
$35,000 |
| WA – capital city |
$600,000 |
$850,000 |
$42,500 |
| WA – other |
$450,000 |
$600,000 |
$30,000 |
| SA – capital city |
$600,000 |
$900,000 |
$45,000 |
| SA – other |
$450,000 |
$500,000 |
$25,000 |
| TAS – capital city |
$600,000 |
$700,000 |
$35,000 |
| TAS – other |
$450,000 |
$550,000 |
$27,500 |
| ACT |
$750,000 |
$1,000,000 |
$50,000 |
| NT |
$600,000 |
$600,000 |
$30,000 |
| Jervis Bay Territory and Norfolk Island |
$550,000 |
$550,000 |
$27,500 |
*The greater capital city areas of each state, the Northern Territory, and the entire Australian Capital Territory, are excluded from the Regional First Home Buyer Guarantee
**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.
(Source)
Regional Schemes Consolidated: The Regional First Home Buyer Guarantee will be merged into the broader program.
First Home Buyer scheme eligibility criteria
To be eligible for the First Home Buyer Scheme, you must meet a few key requirements:
- First Home Buyer: You must be a first home buyer or show that you have not owned or held interest in property in Australia within the past ten years. This includes all types of property, including commercial, investment or company title properties.
- Citizenship and permanent residency – Must be an Australian citizen(s) or permanent resident(s)
- Deposit – Have minimum deposit savings of at least 5%
- Owner-occupier – You must buy or build a home to live in (investment properties are not eligible)
- Minimum age – Must be at least 18 years old.
You can use the
Eligibility Tool for a quick check, but final eligibility will be confirmed by your Participating Lender.
Other schemes for First Home Buyers
The First Home Buyer Scheme is just one option. There are also a few other government programs that could help you get into the market.
First Home Super Saver Scheme: This scheme allows you to save for your home deposit through your superannuation fund. Because these contributions are taxed at a lower rate, you can grow your deposit faster and keep more of your money.
First homeowner Grants and Stamp Duty Help: This is a national scheme, but the exact amount and eligibility rules are set by each state and territory. The First homeowner Grant is a cash payment from your state government that can be used to buy or build a new home. In addition, you may be eligible for a stamp duty discount or even an exemption, which can mean another significant saving.
Help to Buy Scheme: This scheme is designed to help lower-income buyers purchase a home with as little as a 2% deposit. The government can contribute up to 40% of the property’s value, which reduces the amount you need to borrow. It’s important to note, however, that this isn’t free money — the government holds a share in your home, which you’ll need to repay if you decide to sell.
FAQs
Q: How do I apply for the First Home Buyer Scheme?
A: You can’t apply directly to the government. You need to talk to a bank or a mortgage broker. They will help you with the application and check if you are eligible for a home loan.
Q: Can I use the First Home Buyer scheme for an investment property?
A: No. The First Home Buyer Scheme is only for people who plan to live in the home they are buying.
Q: Is the First Home Buyer scheme a cash grant?
A: No, it is not a cash payment. It is a guarantee the government gives to the bank, so you can buy a home with a 5% deposit and not pay for Lenders Mortgage Insurance.
Q: Can I apply for more than one government scheme at the same time?
Yes. Many buyers combine schemes—for example, using the First Home Buyer Scheme with the First Home Super Saver Scheme, plus state-based stamp duty concessions. However, Help to Buy cannot be combined with the FHBG.
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