Help to Buy Scheme: What first home buyers need to know

Key takeaways

• The Help to Buy Scheme is open through participating lenders in participating states and territories
• Eligible buyers may be able to purchase with a 2% deposit and a smaller home loan 
• The 2026 Federal Budget included new housing measures aimed at improving affordability and supply 
• Income limits, property price caps and eligibility rules apply depending on your circumstances

Update (1 July 2026): From 1 July 2026, the Australian Government expanded the Help to Buy Scheme by increasing the income thresholds and property price caps. If you're considering Help to Buy, it's worth checking the latest eligibility requirements before applying.

Buying a home can feel out of reach for many Australians, especially when saving a large deposit while managing rising living costs.

The Australian Government’s Help to Buy Scheme is designed to help eligible buyers enter the property market sooner with a smaller deposit and lower mortgage repayments.

The scheme uses a shared equity model, where the government contributes part of the purchase price in exchange for a share in the property.

Here’s what first home buyers should know about how the scheme works, who may be eligible, and what has recently changed.

What is the Help to Buy Scheme?

The Help to Buy Scheme is a federal shared equity program designed to support eligible Australians into home ownership.

Under the scheme:

• Eligible buyers can purchase with a minimum 2% deposit

• The Australian Government can contribute up to 30% for an existing home or up to 40% for a newly built home

• Buyers take out a smaller mortgage because the government contributes part of the purchase price

• The government holds an equity share in the property

Because the loan amount may be smaller, some buyers could have lower repayments compared to purchasing without the scheme. Individual outcomes will depend on your circumstances, lender criteria, and the property you buy.

Is the Help to Buy Scheme open?

Yes. The Australian Government Help to Buy Scheme is open for applications in participating states and territories.

Applications are submitted through participating lenders rather than directly through Housing Australia.

Tasmania has not yet passed enabling legislation to participate in the scheme at the time of writing.

What changed in the 2026 Federal Budget?

The 2026-27 Federal Budget included several housing measures aimed at improving housing affordability and supporting more Australians into home ownership.

The 2026–27 Federal Budget also announced several housing measures aimed at improving housing affordability and increasing housing supply, including:

• proposed changes to negative gearing and capital gains tax for some property investors

• support for eligible first home buyers purchasing with a 5% deposit

• a $2 billion Local Infrastructure Fund to help unlock new housing supply

• funding aimed at speeding up planning and environmental approvals

The government says the measures are intended to improve housing supply and help more Australians enter the property market over time.

For some first home buyers, schemes like Help to Buy may become part of a broader range of pathways designed to improve access to home ownership.

You might also be interested in: How the Federal Budget is influencing property investment decisions

Who may be eligible?

According to the government, eligible applicants must generally:

• Be at least 18 years old

• Be an Australian citizen

• From 1 July 2026, the income thresholds have increased. Eligible individuals can earn up to $110,000 per year, while joint applicants and single parents can earn up to $180,000 per year, subject to the scheme's other eligibility requirements.

• Intend to live in the property as an owner-occupier

• Not currently own property in Australia or overseas

• Have saved at least a 2% deposit

• Be able to obtain a home loan from a participating lender

The expanded eligibility settings mean some Australians who previously exceeded the income or property price limits may now qualify. However, applicants still need to meet all other eligibility requirements, including purchasing an eligible property and living in it as their principal place of residence.

What types of properties can you buy?

According to the government, eligible buyers may be able to purchase:

• New or existing homes

• Apartments, units, townhouses and duplexes

• Vacant land with an eligible building contract

• Properties being demolished and rebuilt under an eligible contract

The property must fall within the price cap for the location.

Help to Buy property price caps

The current Help to Buy property price caps vary depending on where you're buying.

Under the expanded scheme, which took effect from 1 July 2026, these caps continue to apply when assessing eligibility. It's worth checking the latest limits before applying.

Updated caps include:

Source: Australian Government Help to Buy Scheme

Different caps apply for regional areas and other states and territories.

You might also be interested in: 2026 Federal Budget – What borrowers need to know

How does shared equity work?

Under Help to Buy, you own the property, but the government also holds an equity share because it contributed part of the purchase price.

For example, if the government contributes 30% toward the purchase price, it will generally hold a 30% equity interest in the property.

If the property increases or decreases in value, the government shares proportionally in the gain or loss when the property is sold or when the equity share is repaid.

Participants can choose to buy back the government’s share over time, subject to the scheme rules and eligibility requirements.

Source: Australian Government Help to Buy Scheme

What are the potential benefits?

For some buyers, the scheme may:

• Reduce the size of the mortgage needed

• Lower upfront savings requirements

• Help buyers enter the property market sooner

• Reduce the need to save a traditional 20% deposit

Source: Australian Government Help to Buy Scheme

What should buyers consider before applying?

Because Help to Buy is a shared equity scheme, there are ongoing obligations and conditions that buyers should understand before applying.

For example:

• The government keeps an ownership stake in the property

• You may need approval before making certain changes to the property

• You will eventually need to repay the government’s equity contribution

• If property values rise, the repayment amount may also increase proportionally

If you’re comparing different pathways into the market, it may help to look at how Help to Buy compares with other options such as the 5% Deposit Scheme or guarantor-style lending options.

Help to Buy vs the 5% Deposit Scheme

While both schemes are designed to help buyers purchase sooner, they work differently.

The 5% Deposit Scheme helps eligible buyers purchase with a smaller deposit while avoiding Lenders Mortgage Insurance (LMI), but buyers still own 100% of the property.

Under Help to Buy, the government contributes part of the purchase price in exchange for an equity share in the home.

The right option will depend on your deposit, borrowing capacity, long-term plans, and eligibility.

How do you apply?

Applications are made through participating lenders, who assess your eligibility before submitting eligible applications to Housing Australia.

The process generally includes:

1. Checking eligibility

2. Speaking with a participating lender or broker

3. Receiving conditional approval

4. Finding an eligible property within the price caps

5. Finalising the application and settlement process

Because eligibility requirements, participating lenders and property price caps may change over time, it's worth checking the latest Help to Buy information before you apply.

An Aussie Broker can also help you understand how the scheme compares with other pathways into home ownership.

Book a free^ appointment with an Aussie Broker online or in store.

Frequently asked questions