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Federal Budget Changes to the Home Guarantee Scheme

Federal Budget Changes to the Home Guarantee Scheme


  • First home buyers and non-first home buyers offered additional assistance in a recent Federal Budget announcement.
  • Don’t have 20% deposit, no stress minimum 5% deposit only required
  • Three new schemes were announced with a total of 50,000 places available to eligible buyers.

In the latest 2022-2023 Federal Budget the government has made some changes to the Home Guarantee Scheme by expanding the number of schemes available to first home buyers. The Government has advised that the Home Guarantee Scheme was initially put in place in January 2020 to support homebuyers purchasing a new home with a reduced deposit and easing the requirements for lenders mortgage insurance.

Previously the Home Guarantee Scheme was unfortunately due to expire 30 June 2022, however the latest Federal Budget, states that the previous Home Guarantee Scheme will be expanded into three new schemes”, still with the intention to assist buyers who are wanting to enter the property market. The three new schemes that have been announced are as follows:

  1. 35,000 places under the First Home Guarantee Scheme (FHG Scheme) available per year for first home buyers with a minimum 5% deposit
  2. 5,000 places available per year for the Family Home Guarantee Scheme (Family Scheme) for single parents with a minimum 2% deposit
  3. 10,000 places available per year under the new Regional Home Guarantee Scheme (RHG Scheme)

First Home Guarantee Scheme and Family Home Guarantee Scheme

The FHG Scheme will now have 35,000 places available per year for eligible first home buyers purchasing a property with a minimum of 5% deposit. The FHG Scheme with the additional places will now come into effect 1 July 2022 for eligible first home buyers purchasing new or existing homes.  Whereas, the Family Scheme will now have 5,000 places available from 1 July 2022 till 30 June 2025 supporting eligible single parents to purchase their first home or re-enter the housing market with a minimum 2% deposit.

Regional Home Guarantee Scheme

The RHG Scheme is a new scheme that Government is offering and comes into effect from 1 October 2022 till 30 June 2025. Each year under the RHG Scheme there will be 10,000 places available for eligible persons to apply. This Scheme allows eligible homebuyers with a minimum 5% deposit in rural and regional areas the opportunity to build or purchase a newly-built home in a regional area. Unlike the other schemes that have been introduced, under the RHG Scheme is not limited to only first home buyers; non-first home buyers are also able to apply for the RHG scheme if they have not owned property within the last 5 years.

The Government in addition to limiting available places for each scheme, they have also set out a criterion that will apply depending on the scheme requirements. Some of the criteria requirements which may apply (depending on the scheme) include but not limited to the following:

  1. Australian citizens who are at least 18 years of age.
  2. Single applicants with a taxable income of up to $125,000 per annum for the and couples with a taxable income of up to $200,000 per annum.
  3. Couples under the FHG Scheme is defined to include people who are married or in a de-facto relationship with another person only.
  4. Property being purchased must be for purpose of owner-occupied not investment.
  5. The Value of the property must be within the price caps introduced depending on which state and location of the property being purchased.

The Government has mentioned that since January 2020 when previous schemes were first introduced, approximately 60,000 first home buyer have been able to purchase their first home and enter the property market with assistance of past schemes. With the additional schemes and places that have been introduced in the 2022-2023 Federal Budget, the Government hopes that despite the continues rise in property prices, that the schemes will help eligible buyers enter the property market who in the past have not been able to or have missed a place with the past schemes.

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This blog is merely general and non specific information on the subject matter and is not and should not be considered or relied on as legal advice. Coutts is not responsible for any cost, expense, loss or liability whatsoever in relation to this blog, including all or any reliance on this blog or use or application of this blog by you.

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