What Is the First Home Guarantee Scheme and How Do You Qualify?

The First Home Guarantee (FHBG), formerly called the First Home Loan Deposit Scheme, is a federal initiative administered by Housing Australia (formerly NHFIC). It lets eligible first home buyers purchase a property with as little as a 5% deposit, while the government guarantees up to 15% of the property value to the lender. This means: • No Lenders Mortgage Insurance (LMI), which can save $10,000 to $35,000 upfront • You still need to demonstrate you can service the larger loan at the lender's buffered rate • You still need genuine savings or acceptable equivalents for your 5% (gifted deposits and First Home Owner Grants generally qualify under most lender policy) The scheme is delivered via a panel of participating lenders (banks, customer-owned banks, and non-banks). You apply through the lender (or a broker on the panel), not directly to Housing Australia. Following 2024–2025 reforms, the scheme has been expanded to remove or significantly relax the previous annual cap on places.

To qualify for the First Home Guarantee in 2026, you generally need to: • Be an Australian citizen or permanent resident, aged 18 or over • Be a first home buyer (you and your co-applicant must not have previously owned property in Australia, with limited exceptions for re-entry buyers under specific rules) • Buy as an owner-occupier and move in within an eligible timeframe (typically within six months of settlement) • Buy a property within the relevant price cap for the region (see next section) • Have at least 5% genuine savings (or eligible equivalents) From 1 October 2025, the previous income test ($125,000 single / $200,000 combined) was removed. There is no longer an income cap on the scheme. The earlier annual limit of 35,000 places was also abolished, so every eligible applicant can now access the guarantee. Couples must be married or in a de facto relationship to apply jointly. Friends and siblings buying together do not currently qualify under the joint pathway. Always confirm the current rules at housingaustralia.gov.au before relying on them.

Property price caps were lifted significantly from 1 October 2025. The headline caps for 2026 are: • Sydney and NSW regional centres: $1,500,000 • Brisbane and Queensland regional centres (Gold Coast, Sunshine Coast): $1,000,000 • Melbourne and Geelong: $950,000 • Perth: $850,000 • Adelaide, Hobart, Canberra: lower capital city tiers (refer to Housing Australia) • Darwin: $750,000 (from 1 July 2026); rest of NT: $600,000 • Other regional and smaller areas: lower caps based on the postcode tier Caps are set by Housing Australia and reviewed periodically. The cap that applies is the cap at the time of the contract date, based on the property's location. Because cap classifications affect your maximum purchase price by tens of thousands, confirm the live cap at housingaustralia.gov.au for the specific suburb you are targeting before signing a contract.

The First Home Guarantee is one of several federal and state programs. Depending on your situation, you may be able to combine: • Family Home Guarantee: 2% deposit, no LMI, for eligible single parents and single legal guardians (regardless of whether they have owned property previously) • Regional First Home Buyer Guarantee: similar to FHBG with regional-specific caps (where active under current settings) • Help to Buy: federal shared-equity scheme where the Commonwealth takes up to 30% (existing) or 40% (new build) equity, reducing the loan you need to service • State-based first home buyer concessions and grants (for example, the Queensland First Home Owner Grant of $30,000 for new builds, and the Queensland first home stamp duty concession) • First Home Super Saver Scheme: lets you make voluntary contributions to super and withdraw them (plus deemed earnings) for a deposit Stacking the right combination of federal scheme, state concession, and grant can reduce your upfront cash requirement by $30,000 to $80,000 compared to a standard purchase. A broker who works with first home buyers regularly will run the numbers across the available options for your specific situation and price point.

This is general information only, not personal credit advice. Your actual options depend on your full financial picture, including your income, deposit, credit profile, and the specific loan structure you need. Speak with a licensed broker for advice tailored to your situation.