Australian Government Help to Buy Scheme

How it works

Help to Buy is a shared equity Scheme where the Australian Government contributes towards the purchase price of your home. 

Under the Help to Buy Scheme you will need to:

• save a minimum 2% deposit
• obtain a home loan from a Participating Lender.

The Australian Government will:

• contribute up to 30% (existing homes) or 40% (newly built homes) toward the purchase price.

This allows you to buy a home sooner by:

• bridging the gap between what you can borrow and the price of a home that suits your needs
• helping your deposit go further, enabling you to buy sooner.

When you buy a home through the Help to Buy Scheme, you will own the home but share some of the value with the Government. As the Australian Government has contributed to purchasing the property, the Government will proportionally share any gains or losses made when you sell your home or when you buy out the Government’s equity share.  

Example: Rob's purchase with Help to Buy

Rob bought a home for $800,000 through the Help to Buy Scheme. His home purchase was structured as follows:

• $16,000 deposit from Rob
• $544,000 loan from his Participating Lender
• $240,000 contribution from the Government
• total property value: $800,000.

From this arrangement:

• Rob’s loan to value ratio (LVR) is 68% ($544,000 ÷ $800,000). He repays this loan over 30 years through monthly principal and interest repayments to his lender.

• the Government holds a 30% equity share ($240,000 ÷ $800,000). The contribution must eventually be repaid, either through:
  • voluntary repayments
  • when Rob has the financial capacity to make a payment to buy back the Government's equity or
  • when Rob sells the property.
• the amount paid will always be based on the value of the property at the time of making the payment.

By understanding these obligations, Rob knows what he needs to repay regularly to his lender, and how his long-term path to full home ownership works under the Help to Buy Scheme.

Eligibility 

Home buyers will need to meet the eligibility criteria to qualify for Help to Buy. These include:

• minimum age – must be at least 18 years old
• deposit – minimum 2% of the home purchase price
• citizenship – must be Australian citizens
• single and joint applicants – you can apply to the Scheme either alone or together with one other person, provided you both meet the eligibility criteria
• income – must have an annual taxable income at or below $100,000 for individual applicants or $160,000 for single parents and joint applicants, as shown on the ATO Notice of Assessment (NOA) for the previous financial year
• owner-occupier – must live in the home as the principal place of residence whilst a part of the scheme (investment properties are not eligible)
• property ownership – cannot currently own any property in Australia or overseas. There are exceptions for single parents who own property jointly with someone else and want to buy out the other person's share or intend to sell their existing ownership
• other Australian Government assistance – cannot receive help from other schemes, including shared equity schemes, loans or guarantees provided by States or Territories to support the purchase. However, you can still benefit from stamp duty concessions, grants and other exemptions.

Use the Help to Buy Eligibility Tool for a quick check of the main eligibility criteria to help you understand if you may be eligible.

Types of homes you can buy

Help to Buy will support you to buy a newly built or existing home in Australia at or below the property price cap for the location.

You may use Help to Buy to purchase:

• a new or existing home, including house, townhouse, apartment, unit or duplex
• a vacant block of land for the development of a new home or a property that’s being demolished and rebuilt, provided you’ve signed a comprehensive building contract with an eligible builder.

Please note the following Australian States have yet to pass enabling legislation to participate in the Help to Buy Scheme: Western Australia, South Australia, and Tasmania. 

This page will be updated to reflect when the above Australian States commence participation in Help to Buy.

How to apply and next steps

The Help to Buy Scheme is coming soon. Once the Scheme is open to applications, you will be able to apply through a Participating Lender authorised to offer the Help to Buy Scheme. You cannot apply directly to Housing Australia, who administer the Scheme, for Help to Buy. A Participating Lender will assess your eligibility and submit an application on your behalf.

Participating Lenders will be confirmed when the Help to Buy Scheme is open for applications.

To register to receive email updates on Help to Buy, click here. 

Ongoing obligations and exit

While you are part of the Help to Buy Scheme, you will need to continue meeting the eligibility criteria. This includes: 

• maintaining your home
• keeping your home insured
• participating in reviews such as, but not limited to, providing your updated income details and information about key changes to your personal circumstances.

The Help to Buy Scheme is designed to help you get into home ownership, but it isn’t meant to be a lifelong commitment. Once you’re in your home, you can begin a journey toward full ownership. 

There are a few ways to leave the Help to Buy Scheme:

1. you can make incremental repayments from your savings to increase your equity share over time
2. you can buy back all or some of the Government’s equity, through additional lending
3. you can sell your home.

You may have other ongoing obligations once you are officially a participant in the Help to Buy Scheme. Further information on ongoing obligations and Scheme exit will be published once Help to Buy is officially announced and open for applications.