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Government boosts max property prices for home guarantees

Prime Minister Scott Morrison has promised higher property price caps for new buyers under the Home Guarantee Scheme from July.

Tens of thousands more consumers are expected to benefit from the new property price caps under the Home Guarantee Scheme from 1 July, after the program was expanded to 50,000 places per year in the recent federal budget.

The government had also established a new guarantee scheme specifically for regional buyers in the budget, to add to its existing programs for first home buyers and single-parent families.

The First Home Guarantee and Regional Home Guarantee schemes allow eligible buyers to purchase a home with a deposit as small as 5 per cent, while the government guarantees up to 15 per cent of the property price – allowing the buyer to skip lender’s mortgage insurance.


The Family Home Guarantee on the other hand allows single parents with dependent children to purchase homes with a deposit as small as 2 per cent.

Mr Morrison commented the Home Guarantee Scheme had already assisted 60,000 Aussies to home ownership.

“Saving to buy a house has always been hard work and we know as prices have increased it’s been getting harder,” he said.

“People are cutting years off the time they’d need to save a deposit for a home because of this program. Now even more Australians can get into a home sooner.”

The new price caps across states will now apply during the 2022-23 financial year:

  • NSW
    Capital city and regional centres – $900,000 from $800,000 before
    Rest of state – $750,000 from $600,000 before
  • Victoria
    Capital city and regional centres – $800,000 from $700,000 before
    Rest of state – $650,000 from $500,000 before
  • Qld
    Capital city and regional centres – $700,000 from $600,000 before
    Rest of state – $550,000 from $450,000 before
  • WA
    Capital city and regional centres – $600,000 from $500,000 before
    Rest of state – $450,000 from $400,000 before
  • SA
    Capital city and regional centres – $600,000 from $500,000 before
    Rest of state – $450,000 from $350,000 before
  • Tasmania
    Capital city and regional centres – $600,000 from $500,000 before
    Rest of state – $450,000 from $400,000 before
  • ACT
    Capital city and regional centres – $750,000 from $500,000 before
  • NT
    Capital city and regional centres – $600,000 from $500,000 before
  • Jervis Bay Territory and Norfolk Island; and Christmas Island and Cocos (Keeling) Islands have seen no changes, with their respective caps being $550,000 and $400,000.

The capital city price thresholds apply to regional centres with a population over 250,000 – including Newcastle and Lake Macquarie, Illawarra (Wollongong); Geelong; Gold Coast and Sunshine Coast.

Assistant Treasurer and Minister for Housing Michael Sukkar revealed the government had been encouraged to make the move by current guarantee users making larger repayments than needed.

“Because 41 per cent of scheme-backed loans are ahead of their pay back schedule, we are confident these adjusted price caps strike the right balance,” he said.

“We acknowledge how hard it can be to buy a new home or re-enter the housing market and that saving a deposit is the hardest part of getting into home ownership. By adjusting the price caps for the Home Guarantee Scheme, we are ensuring Australians have more options when buying a home.

There will be 35,000 places available in a year under the First Home Guarantee (formerly the First Home Loan Deposit Scheme, or FHLDS) from July, up from the current 10,000. 

The Family Home Guarantee will have an additional 5,000 guarantees each year from July to 30 June 2025. 

The newly established Regional Home Guarantee will have 10,000 places from 1 October to 30 June 2025, for eligible buyers (including those who have previously owned homes), to purchase or construct a new property in regional areas. 

Guy Barnett, Tasmanian Minister for State Development, Construction and Housing welcomed the new caps, stating it would add to the state’s recently launched 10-year $1.5 billion housing package.

Previously, the Family Home Guarantee (the scheme for single-parent families) had faced criticism before raising its property price caps, with senators stating it would barely cover houses in areas such as regional Tasmania.

A Western Australian broker more recently told Mortgage Business sister brand The Adviser that reviewing and extending the state’s regional threshold would allow more buyers to access the scheme, after the 2021 market boom.

[Related: Property industry braces for rate rises]

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