The Help to Buy Scheme: What is it?
- Lilly Mackay
- Dec 1
- 3 min read
Recognising the ongoing challenges to home ownership, the Australian government has introduced a new initiative today, the Help to Buy Scheme. The goal - answering that age old question of ‘how to buy your first home’ and getting more Australians onto the property ladder, faster.
Still wondering how to buy your first home? Keep reading for an overview on how the Help to Buy Scheme works, whether you might be eligible and what obligations you have under the Scheme.
What is the Help to Buy Scheme?
The Help to Buy Scheme is a shared equity scheme run by the Australian Government. The goal is to support more Australians into home ownership, faster.
If you successfully apply to the Scheme, the Australian Government will contribute up to 30% toward the purchase price of an existing home. This rises to 40% for new builds.
Under the Scheme, you own the home but share some of the value with the Government. This means that the Government shares any gains or losses in value to the home when you sell or reach the goal of full ownership.
What are the benefits of the Help to Buy Scheme?
The Help to Buy Scheme has many benefits
lower deposit than the 5% Deposit Scheme
lower serviceability requirements than the 5% Deposit Scheme
Lower serviceability requirement = lower income needed to reach loan serviceability requirements
Who’s eligible for the Help to Buy Scheme?
The Help to Buy Scheme does have eligibility criteria including:
a minimum age of 18 years old
a minimum 2% deposit of the home purchase price
Australian citizenship
annual taxable income must be at or below $100,000 for individual applicants or $160,000 for single parents and joint applicants.
you must be purchasing the home to live in as your principal place of residence whilst part of the scheme
you cannot currently own any other property in Australia or overseas (although there are exceptions for single parents)
you cannot receive any additional help to purchase from other schemes, including shared equity, loans or guarantees provided by States or Territories.
My First Loan can help you understand if you meet the criteria required.
What can you buy using the Help to Buy Scheme?
Great news - both existing homes and new builds are included in the Scheme, provided they’re below the property price cap for their location.
What are my obligations as part of the Help to Buy Scheme?
The key goal of the Scheme is supporting Australians into home ownership. This is one relationship where you’re encouraged to break up as you reach the goal of full home ownership.
While a part of the Scheme you’re expected to:
maintain your home
keep the home insured
participate in reviews (for example updates on your income details).
To exit the Scheme you have a few options:
sell your home (and repay the Government their share of the value)
make regular repayments from your savings until you reach full ownership
buy all or some of the Government’s share through an additional loan.
How to apply to the Help to Buy Scheme.
MyFirstHome and My First Loan property experts have all the tools to turn your home ownership dream into reality. From understanding eligibility criteria and working out the best home loan for your lifestyle, to getting you the keys to your perfect first home. Take that first step now and let us guide you smoothly through the application process.
Mortgage brokerage services are provided by a related body corporate of MyFirstHome Pty Ltd, MyFirstLoan.au Pty Ltd ACN 168 808 946 (MFL) as a credit representative (Australian credit representative number 564038) of Allied Financial Consulting Pty Limited ACN 059 732 419, which holds Australian Credit Licence number 393845. As a credit representative, MFL is authorised to provide credit services where it is not a credit provider under any credit contract, for example, to act as a broker for loans provided by other credit providers. Loans brokered by MFL are structured and managed by Homestar Finance (which holds Australian Credit Licence 390860), which engages a professional trustee and lender to be the 'lender of record' for its loans. Quoted rates are correct as on publication date.
