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The "Home Guarantee Scheme": What is it and how does it help first home buyers? (Updated For 2023!)


Australia’s Home Guarantee Scheme is a government initiative aimed at helping first-time home buyers enter the property market. While the scheme does also include the Family Home Guarantee (FHG), this post is specifically to do with the First Home Guarantee (FHBG).


Note: We will address the Family Home Guarantee in our very next blog post!!!!


The scheme was introduced in response to the economic impact of the COVID-19 pandemic, which has made it difficult for many Australians to secure a home loan. Under the First Home Guarantee Scheme, the government guarantees up to 15% of the value of a property purchased by a first-time home buyer. This means that buyers can secure a home loan with a deposit as low as 5% without needing to pay lenders mortgage insurance, rather than the usual 20% required by most lenders to avoid LMI. The scheme is available for both new and existing properties, and while there are no restrictions on the location or type of property that can be purchased, there is a purchase price limit which varies from state to state. In the case of Western Australia, that figure is currently (as of June 9th 2023) set at $600,000 for Perth and Regional Centres, and $450,000 for the rest of WA.


Essentially, the First Home Guarantee Scheme is designed to make it easier for first-time home buyers to enter the property market, particularly in areas where property prices are high. By reducing the deposit required to secure a home loan, the scheme makes it more affordable for buyers to purchase a property and get a foot on the property ladder.

How has the guarantee changed in 2023?

In 2023, the federal government made several important changes to the scheme, which opens the offer to a greater number of Australians. These changes include:

  • Now available to permanent residents (previously just open to Australian citizens)

  • Now open to "any two eligible individuals" as opposed to singles and couples in prior years

  • 35,000 places available for FY2022/23 and the same again for FY2023/24

In addition to helping first-time home buyers, the First Home Guarantee Scheme also benefits the wider economy. By increasing demand for property, the scheme helps to support the construction industry and create jobs. It also helps to stimulate economic growth by encouraging spending on home furnishings and other related goods and services.

Remember, to be eligible for the First Home Guarantee Scheme, buyers must meet certain criteria. As of 2023, buyers must be Australian citizens or permanent residents, and they must be first-time home buyers who have not previously owned a property. They must also meet the income and asset limits set by the government. The best way to see if you qualify is to speak to a broker. The team here at Neptune Finance are happy to assist, and you can go HERE to book a time for an obligation free chat!

Overall, the First Home Guarantee Scheme is a valuable initiative that helps to support first-time home buyers and continue to provide housing solutions as well as stimulating economic growth. By reducing the deposit required to secure a home loan, the scheme makes it easier for buyers to enter the property market and achieve their dream of owning a home.


As Always - the information in this blog post is general only and shouldn't be constituted as advice. Your complete financial situation will need to be assessed before acceptance of any proposal or product.

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