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Help to Buy Scheme – Federal Government shared equity

The Federal Government is offering to help you buy your home, with a shared equity scheme for both new and existing homes.

Page up to date as of 31 May 2022 

Labor’s Help to Buy Scheme has been proposed by the federal government to allow eligible home buyers to enter the property market sooner.1 Similar to previous state initiatives – VIC HomeBuyer Fund and WA HomeShare Scheme - this scheme is a shared equity scheme meaning the contribution of up to  40% made by the government is in exchange for a share, or proportional interest in the property.  

It is important to note that this initiative was proposed by the government.2  

What is the Help to Buy Scheme and how does it work? 

The Help to Buy Scheme is a shared equity scheme that will allow eligible home buyers to purchase a property with a smaller deposit. This scheme works by allowing buyers with a deposit of at least 2% of the property’s purchase price to obtain a loan with an equity contribution from the Government.3  

The size of the equity contribution available can vary from up to 30% for an existing home to up to 40% of the purchase price for a new home. This aims to assist eligible home owners to enter the property market sooner with a smaller deposit and benefit from a smaller mortgage and smaller mortgage repayments. While you would not be required to pay rent on the portion of the home held by the Government, it is expected that the Government’s equity contribution be paid down over time, or paid back if you sell.  

10,000 places for the Help to Buy Scheme will be available each year for eligible homebuyers.  

Eligibility criteria for the Help to Buy Scheme 

  • Citizenship: Be an Australian citizen, at least 18 years of age 
  • Income: Yearly income is $90,000 or less for individuals, or $120,000 or less for couples 
  • Residential property: You must live in the purchased home 
  • Ownership: You must not currently own any other land or property in Australia or overseas 
  • Deposit: Have saved the required minimum 2% deposit of the home price and are able to finance the remainder of the purchase through a home loan with a participating lender 
  • Costs: Be able to pay for all associated upfront costs, such as stamp duty, legal fees and bank fees. You will also be responsible for ongoing costs associated with the property such as rates, strata, electricity bills, etc.  

Property price caps for the Regional First Home Buyer Support Scheme 

State 

Property price cap  

Capital city & regional centres 

Rest of state 

NSW 

$950,000 

$600,000 

VIC 

$850,000 

$550,000 

QLD 

$650,000 

$500,000 

WA 

$550,000 

$400,000 

SA 

$550,000 

$400,000 

TAS 

$550,000 

$400,000 

ACT 

$600,000 

$600,000 

NT 

$550,000 

$550,000 

Source: https://www.alp.org.au/policies/helping-more-australians-into-home-ownership 

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FAQs about the Help to Buy Scheme

The savings provided from the Help to Buy Scheme can vary depending on the location you are looking to buy your home and whether that home is new or existing. The savings from this scheme can accumulate over time through having a smaller loan amount and loan repayments.  

For example, if you purchased a new home in Sydney valued at $950,000, you could receive savings of up to $380,000 over the life of the loan.4 

In addition to the savings over time from having a smaller loan size, you can save upfront by not having to pay Lenders’ mortgage insurance (LMI). LMI is usually required to be paid if your home loan is more than 80% of the purchase price of the property. Despite only needing a 2% deposit, as the Government’s contribution from the Help to Buy scheme can be up to 40% of the purchase price, you will not be required to pay LMI.  

The Federal Government can contribute up to 40% of the purchase price of a new home and up to 30% for an existing home.  

To be eligible, you will need to provide a deposit of at least 2% and be approved forl a home loan to finance the remaining portion of your share of the equity.  

The benefits of this scheme for eligible homebuyers can include:

  • Entering the market sooner than expected with a low deposit
  • LMI would not be payable despite a deposit of less than 20% of the purchase price
  • The Government will not charge any fees or interest on their equity contribution
  • Your home loan amount and repayments would be less than if the loan balance was for the full equity amount.

Yes, you’re able to apply for an additional stake in the home when you're able to do so. The minimum stake that can be purchased from the Government's share is 5%.  

If your income exceeds the annual threshold for two consecutive years, you may be required to repay the Government’s contribution either in part or in full depending on the circumstances.  

The Government has not currently advised if you would be required to sell the property in this scenario and we will update once the information is available.  

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Step-by-step guide to home ownership

There are many steps involved in purchasing a property which can vary between residential and investment properties. This guide explains each step in order as well as what is involved at every stage of the purchasing process.


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