The federal government will speed up the start of its expanded Home Guarantee Scheme to 1 October and expand eligibility criteria.
Through the expanded five per cent deposit scheme, the government will guarantee a portion of a first home buyer’s home loan, so they can purchase with a lower deposit and not pay Lenders Mortgage Insurance.
Income limits on eligibility will be removed from October and there is now no limit on the number of places available under the scheme.
As long as a first homebuyer has saved the minimum five per cent deposit they are eligible to apply.
Property price caps have also been revised to reflect price growth across Australia. In Victoria, the price limits in Melbourne and regional centres have been lifted to $950,000. In other parts of the state the price limit is $650,000.
According to the government, the median home price in Australia today is $844,000 and five per cent of that is $42,200. The last time $42,200 covered the 20 per cent deposit for a median home was 2002, which shows the generational scale of this change.
After consulting with industry, the government will also direct Housing Australia to promote the diversity of lenders who offer the scheme, giving first home buyers greater choice to buy a home through smaller, customer-owned and regional banks.
“We want to help young people and first home buyers achieve the dream of home ownership sooner,“ said Prime Minister Anthony Albanese.
“Bringing the start date of our five per cent deposit scheme forward will do just that. Getting more Australians into their own home quicker, while saving them money along the way.”
For more information on the five per cent deposits scheme, go to the Housing Australia website
