Home Guarantee Scheme: getting into your first home faster, with a smaller deposit.

With the property market heating up thanks to the recent interest rate drops, it is extremely welcome news that the federal government’s home guarantee scheme (also known as the 5 percent deposit scheme) will be launching three months sooner than expected, from 1 October 2025.

The home guarantee scheme grant explained.

What is the 5 percent deposit scheme?

With the 5 percent deposit scheme, the federal government is aiming to get more first home buyers into homes faster. At the same time, reducing up-front costs of buying a home.

The first home buyer grant allows first home buyers to purchase a property with only a 5 percent deposit. The government acts as a guarantor for the remaining 15 percent. This means first home buyers can get onto the property ladder with less cash in the piggy bank. Buying costs will also be reduced as, with the government acting as guarantor, costly Lenders Mortgage Insurance (LMI) will no longer be required.

Who’s eligible for this government incentive for first home buyers?

From October, previous yearly participant caps on the scheme will be removed. This means that any first home buyer will be eligible for a first home buyer grant, provided the house they are purchasing falls within the scheme’s property price caps.

The good news on that front though, is that come October, these caps will rise, giving first home buyers a larger pool of property to buy from. In Melbourne, the price cap lifts from $800,000 to $950,000, in Sydney it lifts from $900,000 to $1.5 million, and in Brisbane it lifts from $700,000 to $1 million.

What impact will these changes have on first home buyers and the property market?

In the first year of the expanded scheme, it’s expected an additional 70,000 first home buyer grants will be issued - meaning 70,000 more first home buyers entering the market. Industry leaders have stressed the need to regularly review the scheme from July 2026, to ensure it’s not overheating key housing markets.

For first home buyers, the Treasury has estimated tens of thousands of dollars in rent could be saved by buyers accessing home ownership earlier, thanks to the scheme.

In short:

• The home guarantee scheme (5 percent deposit scheme) is launching in October 2025.

• Previous yearly participant caps on the scheme will be dropped from October 2025.

• With the government acting as a guarantor, from October first home buyers will only need a 5 percent deposit and won’t need costly Lenders Mortgage Insurance.

• Property price caps will lift in most regions, meaning a larger pool of property is available to first home buyers wanting to take advantage of the scheme.

• Around 70,000 additional first home buyers are expected to benefit in the first year.

• Getting into their first property faster could save first home buyers tens of thousands of dollars in rent, according to Treasury estimates.

Crunching the first home buyer numbers.

Applying the first home buyer grant to a property valued at the national median price of $844,000, just a $42,200 deposit is needed to secure your first property.

Really savvy first home buyers looking at buying a house in Victoria however, can take their first step on the property ladder with even less. Marrone Park, in Victoria’s Cranbourne East, is offering architecturally designed townhouses selling from $620,000. First home buyers taking advantage of the 5 percent deposit scheme could be moving in here with a deposit as low as $31,000. Although with a limited release of only 6 townhouses, they’ll have to be fast if they want to secure one for themselves.

Marrone Park - your first home?

Set in a premium location, directly opposite tranquil parkland yet providing easy access to all you could need, Marrone Park ticks all the boxes on the first home checklist. Absolutely affordable (and even more so with the 5 percent deposit scheme coming into play in October), these move-in ready townhouses are set up for first home buyers with plans.

• Be part of an established and growing community

• Have plenty of room to grow with 4 spacious bedrooms

• Put your feet up knowing that these turnkey townhouses are low maintenance and come with a 50 year structural warranty.

  
  

Get in before the crowds. Start your first home journey at Marrone Park.