Should there be more home buyer assistance?

On Tuesday evening (14 May), the federal Treasurer Jim Chalmers handed down the Albanese government’s budget for 2024/25, saying a range of measures and funding allocations to address the housing crisis.

While the majority of the initiatives target social and affordable housing, there have been some quarters voicing disappointment that more hasn’t been provided to help more Australians enter the increasingly expensive property market.

However, a vast range of home buying assistance schemes are already available across Australia to support prospective home buyers to enter the housing market.

For example, the federal government has home buyer support schemes available through Housing Australia’s Home Guarantee Scheme, which enables eligible first home buyers (FHBs), regional Australians, and single parents to get on the property ladder with a smaller deposit and without paying lenders mortgage insurance (LMI). These include:

• The First Home Guarantee (which allows FHBs to buy a property with a 5 per cent deposit).
• The Regional First Home Buyer Guarantee (which enables regional FHBs to buy a property with a 5 per cent deposit).
• The Family Home Guarantee (which supports single parents and guardians, allowing them to buy a home with a 2 per cent deposit).

Under the scheme, there are income caps and property price caps that differ depending on the state and the scheme.

The Commonwealth government also offers the First Home Super Saver Scheme, which allows FHBs to access voluntary contributions made to their super accounts for their first home deposit.

And there will also soon be Help to Buy (yet to pass Parliament) that aims to allow up to 40,000 eligible Australians to purchase property with a 2 per cent deposit without paying LMI. Instead, the government would provide an equity contribution of up to 40 per cent for new homes and 30 per cent for existing homes.

But it’s not just federal schemes that borrowers can access, the states also have a range of assistance schemes in place.

NSW

The NSW government has three key home buyer assistance schemes separate from the Commonwealth’s home buying initiatives:

• First Home Buyer Assistance scheme (which offers stamp duty exemptions and concessional rates for FHBs).
• The First Home Owner (New Home) Grant (which offers a $10,000 grant to FHBs who purchase or build a brand-new home).
• The Shared Equity Home Buyer Helper scheme (which offers the same benefits as the federal government’s Help to Buy initiative).

The Shared Equity Home Buyer Helper scheme, however, has been unpopular, with 94 per cent of approved places under the scheme still unused as of March 2024.

Victoria

The Victorian government also offers FHB grants and stamp duty exemptions. The Victorian government schemes include:

• The First Home Owner Grant (which provides FHBs with a $10,000 grant if they purchase a new home valued at $750,000 or less).
• Stamp duty exemptions for FHBs, pensioners, young farmers, and others.
• The Homebuyer Fund (which provides a 25 per cent equity contribution to buyers with a 5 per cent deposit). However, this will be scrapped next year due to the anticipated introduction of the Help to Buy scheme.

Qld

Included in the Queensland government home assistance schemes are:

• The First Home Owner Grant (which provides FHBs with up to $30,000 to purchase or build a new home).
• The Queensland Housing Finance Loan (which provides support to those who cannot secure a loan with a bank, offering reduced deposits).
• The Pathways Shared Equity Loan (which allows those in public housing the opportunity to purchase at least 60 per cent of the home they are renting).
• Stamp duty concessions for FHBs and other home buyers.

WA

The Western Australian government’s home buying assistance schemes include:

• The First Home Owner Grant (which provides a $10,000 grant to FHBs buying a property they intend to live in).
• Stamp duty exemptions for FHBs buying a property less than $430,000 and concessional rates for a property worth $530,000 or less.

Tasmania

The Tasmanian government home buying assistance schemes include:

• The First Home Owner Grant (which provides FHBs with a $30,000 grant for purchasing or building a new home).
• Stamp duty concessional discounts of 50 per cent for FHBs and pensioners (subject to property price caps).
• The MyHome shared equity program (which offers an equity contribution of up to 40 per cent, with a minimum deposit of 2 per cent).

SA

The South Australian government offers a variety of home buying assistance schemes including:

• The First Home Owner Grant (which offers up to $15,000 for buying or building a new home that a FHB intends to live in).
• HomeStart home loans (in partnership with the South Australian government) that provide loans with reduced deposits.
• Shared Equity loans (provided by HomeStart, which provides an equity contribution of up to 25 per cent of the property value).
• Stamp duty exemption for FHBs if the property is worth less than $650,000.

ACT

The ACT government home buying assistance schemes include:

• Stamp duty exemptions for those purchasing a property worth $1 million or less (subject to income caps).

NT

The Northern Territory offers home buying support schemes to help FHBs and low-income earners. The schemes include:

• The First Home Owner Grant (which provides a $10,000 grant to FHBs who buy or build a new home).
• The HomeBuild Access program (which allows buyers to access low deposit loan options if the home is newly built).

[Related: Victorian Homebuyer Fund to end next year]