Buying With A Deposit As Little As 5%
//Home Guarantee Scheme (HGS) - Australia-wide
Deep Dive
Purchasing your first home is a major milestone, and the Australian Government’s Home Guarantee Scheme (HGS) makes it more achievable for first home buyers across the country. At InDepth Mortgage, we specialize in helping first-time buyers leverage this scheme to secure their dream home with minimal upfront costs. This guide provides a comprehensive overview of the HGS, including eligibility, benefits, and the expanded terms effective from October 1, 2025, applicable to all Australian states and territories.
What is the Home Guarantee Scheme?
The Home Guarantee Scheme, administered by Housing Australia, enables eligible first home buyers to purchase a home with a deposit as low as 5%, without paying Lenders Mortgage Insurance (LMI). The government guarantees up to 15% of the loan for first home buyers, reducing the financial barrier to homeownership. The scheme is delivered through over 30 Participating Lenders, including major banks (e.g., Commonwealth Bank, NAB), customer-owned banks, and regional banks across Australia.
As of October 1, 2025, the HGS has been significantly expanded to remove place limits, income caps, and increase property price caps, making it accessible to more Australians. It supports a variety of property types, including houses, units, townhouses, apartments, house-and-land packages, and off-the-plan properties, provided they meet the price cap for your region.
Key Benefits of the HGS
Low Deposit: Purchase with just a 5% deposit, with the government guaranteeing the remainder, saving you thousands on LMI (often $10,000–$20,000).
No Place Limits: Unlimited guarantees ensure all eligible first home buyers can apply.
No Income Caps: High earners are now eligible, broadening access across all income levels.
Higher Property Price Caps: Increased caps reflect rising property prices, allowing purchases of higher-value homes in capital cities and regional areas.
Simplified Regional Access: The Regional First Home Buyer Guarantee has been merged into the First Home Guarantee, streamlining applications for regional buyers.
The HGS is separate from state-based FHOG programs, and in many cases, you can combine the two for greater financial support. For example, in Queensland, the FHOG offers up to $30,000 for new homes, which can cover or reduce your deposit, while the HGS eliminates LMI costs.
Property Price Caps (Effective October 1, 2025)
The HGS applies to properties under specific price caps, which vary by state, territory, and region to account for local market conditions. Below are the updated caps effective October 1, 2025:
| Location | New Cap (Oct 1, 2025) |
| NSW – Sydney, Illawarra, Newcastle, & Lake Macquarie | $ 1,500,000 |
| NSW – Other | $ 800,000 |
| VIC – Melbourne & Geelong | $ 950,000 |
| VIC – Other | $ 650,000 |
| QLD – Brisbane, Gold Coast, & Sunshine Coast | $ 1,000,000 |
| QLD – Other | $ 700,000 |
| WA – Perth | $ 850,000 |
| WA – Other | $ 600,000 |
| SA – Adelaide | $ 900,000 |
| SA – Other | $ 500,000 |
| TAS – Hobart | $ 700,000 |
| TAS – Other | $ 550,000 |
| ACT – Canberra | $ 1,000,000 |
| NT – Darwin & Other | $ 600,000 |
| Jervis Bay Territory & Norfolk Island | $ 550,000 |
| Christmas Island & Cocos (Keeling) Islands | $ 400,000 |
Note: Regional centres include Illawarra, Newcastle, and Lake Macquarie (NSW); Geelong (VIC); and Gold Coast and Sunshine Coast (QLD).
These increased caps allow first home buyers to target a wider range of properties, particularly in high-cost areas like Sydney, Brisbane, and Melbourne.
Eligibility Criteria
To qualify for the HGS, you must meet the following requirements, consistent across Australia:
Applicant Status
You must be a first home buyer who has not previously owned residential property in Australia (including investment properties, whether lived in or not).
You must be an Australian citizen or permanent resident aged 18 or older at the time of application.
Joint applicants (e.g., couples) are eligible, but all must meet the criteria. A non-resident spouse (e.g., not a citizen or permanent resident) may disqualify the application unless exemptions apply.
Income
As of October 1, 2025, there are no income caps, making the scheme accessible to buyers of all income levels.
Property Requirements
The property must be your principal place of residence, not an investment property.
The purchase price must be within the price cap for your area (e.g., $1,000,000 in Brisbane or $1,500,000 in Sydney).
Eligible properties include new or existing homes, off-the-plan purchases, house-and-land packages, apartments, or townhouses, provided they meet the price cap.
Residency Requirements
You must move into the property within a reasonable period after purchase (typically within 12 months, though lender-specific terms may vary) and use it as your primary residence.
Renting out the entire property before occupying it is not permitted, though specific conditions depend on the lender.
Other Considerations
You must have saved a 5% deposit (e.g., $50,000 for a $1,000,000 property in Brisbane).
You must meet the lender’s credit and repayment criteria, which may include a clean credit history and, in some cases, a good rental history (e.g., 6 months through a registered agent, particularly for Queensland applicants).
The HGS aligns with standard lending requirements, but you should confirm specific terms with your chosen lender.
How to Apply for the HGS
Check Eligibility: Use the Home Guarantee Scheme Eligibility Tool on the Housing Australia website (updated post-October 1, 2025) to confirm you meet the criteria.
Verify Property Price Caps: Ensure your target property falls within the cap for your area (e.g., $1,500,000 in Sydney, $1,000,000 in Brisbane, $700,000 in regional Queensland).
Work With Your InDepth Broker to Pick the Best Participating Lender For You: Choose from over 30 lenders, including major banks, customer-owned banks, or regional options
Apply Through Your Broker & Lender: The lender submits your application to Housing Australia for pre-approval.
Find Your Home: Once approved, secure a property within the price cap and finalise your purchase.
At InDepth Mortgage, we streamline the process by guiding you through eligibility checks, lender selection, and application submission, ensuring you maximize the HGS benefits.
Use our tools to estimate key figures and make informed decisions.
Combining HGS with State-Based First Home Owner Grants
The HGS can often be paired with state-specific First Home Owner Grants (FHOG) to further reduce upfront costs. The FHOG varies by state and is typically available for new homes only. Below is a brief overview of how the FHOG complements the HGS in key states (as of October 2025):
Queensland: Up to $30,000 for new homes valued under $750,000 (contracts signed between November 20, 2023, and June 30, 2026). Can cover the 5% deposit for homes up to $600,000.
New South Wales: $10,000 for new homes or land valued up to $600,000 (home) or $450,000 (land). The HGS’s $1,500,000 cap in Sydney allows for higher-value purchases.
Victoria: $10,000 for new homes valued up to $750,000 in metropolitan or regional areas. The HGS’s $950,000 cap in Melbourne supports broader options.
Western Australia: $10,000 for new homes valued up to $750,000 (south of the 26th parallel) or $1,000,000 (north). Aligns with the HGS’s $850,000 cap in Perth.
South Australia: $15,000 for new homes valued up to $650,000. The HGS’s $900,000 cap in Adelaide offers additional flexibility.
Tasmania: $30,000 for new homes with no value cap (subject to conditions). Pairs well with the HGS’s $700,000 cap in Hobart.
ACT: No FHOG, but stamp duty concessions apply. The HGS’s $1,000,000 cap supports Canberra buyers.
Northern Territory: $10,000 for new homes with no value cap. Aligns with the HGS’s $600,000 cap.
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Government Grants and Schemes
As a first-time buyer, you may qualify for federal and state incentives to make homeownership more accessible. These include grants, stamp duty concessions, and low-deposit schemes. Eligibility varies by location, income, and property type—common options allow buying with as little as 5% deposit while waiving LMI. Speak to an InDepth Mortgage specialist to check your eligibility and maximize benefits.
What This Means For First Time Buyers
The Home Guarantee Scheme, with its expanded terms effective October 1, 2025, is a game-changer for first home buyers across Australia. With no place or income limits, higher property price caps, and a low 5% deposit requirement, the HGS—combined with state-based FHOG programs—makes homeownership more accessible than ever. Whether you’re in Sydney, Brisbane, Melbourne, or a regional area, InDepth Mortgage is here to guide you through eligibility, lender selection, and securing the right loan. Book an appointment today to review your circumstances, including credit and rental history, and take the first step toward owning your dream home.
The InDepth Advantage
Why Finance Your First Home With InDepth?
At InDepth Mortgage, we have a deep knowledge of the market, products, and various loan policies. We specialise in first-home buyer incentives, low-deposit options, and guarantor loans. Unlike banks (or listing agents for that matter), we work for you, comparing options to find the lowest rates and best terms. We'll explain everything clearly, from principal and interest vs. interest-only repayments to features like offset and redraw accounts, just to name a few.
Last updated: October 2025. Verify details with InDepth Mortgage, Housing Australia, or state revenue offices for the latest information.
