Australian Home Guarantee Scheme Oct 2025 Explained
From 1 October 2025, the Australian Government is making big changes to the Home Guarantee Scheme (HGS). The aim is to help more first home buyers get into the market sooner, with no place limits, no income caps, and higher property price caps.
Here’s what you need to know.
What’s Changing in 2025?
Unlimited places – all first home buyers with a 5% deposit can apply.
No income caps – higher earners can now access the scheme.
Higher property price caps – reflecting today’s property market.
Simpler regional access – the Regional First Home Buyer Guarantee is merging into the main scheme.
How the Scheme Works
The HGS lets you buy a home with as little as 5% deposit while avoiding Lenders Mortgage Insurance (LMI). The government guarantees the remaining portion of the deposit (up to 15%).
That means you can buy sooner, without saving the full 20%.
Who Can Apply?
First home buyers with at least a 5% deposit.
Income limits removed from October 2025.
Must buy within the new property price caps for your area.
Applications go through participating lenders (major banks and regional banks).
Why It Matters
The 2025 changes are a game-changer for first home buyers. Here’s why:
No more missing out – Previously, the scheme had strict caps on places. Once they ran out, buyers had to wait another year. From October 2025, there are unlimited places – meaning if you’re eligible, you can apply anytime.
No more income limits – Under the old rules, higher earners often didn’t qualify, even though they still struggled with deposits and rising property prices. With income caps removed, professionals and dual-income households can now access the scheme.
Realistic property caps – Many buyers in Sydney, Melbourne, and Brisbane couldn’t find homes under the old thresholds. The new caps reflect today’s market, making it possible to buy actual homes in major cities without being locked out.
Save tens of thousands on LMI – Avoiding Lenders Mortgage Insurance is one of the biggest savings. For example, on a $900,000 Sydney home with a 5% deposit, skipping LMI can save $30,000–$40,000 upfront.
Faster path to ownership – Instead of waiting years to save a 20% deposit, buyers can now enter the market sooner, build equity, and stop paying rent.
Regional buyers included – With the Regional Guarantee merged into the main scheme, access is simpler, and buyers outside capital cities aren’t left behind.