First 2,000 Aussies enter regional FHB scheme

In excess of 2,000 regional first home buyer shared-equity places have been filled, the federal government has confirmed.

Announced on Friday (3 March), Minister for Housing and Small Business Ms Julie Collins confirmed the milestone, with an overall 10,000 spots each financial year still to go.

Just five months after its official launch last October — and although three months earlier than planned — the current rate of successful applicants comes as regional areas have faced some of the largest drops in housing affordability, making it “increasingly hard for locals to save a sufficient deposit,” the minister explained.

The Regional First Home Buyer Guarantee (RFHBG) shared equity scheme allows eligible first home buyers with a minimum 5 per cent deposit to enter the property market, but avoid paying lenders’ mortgage insurance by providing a government guarantee of up to 15 per cent.

Housing Minister Julie Collins said the Albanese government delivered on its commitment three months early to “help more Australians into a home.”

“I’m so pleased [that] more than 2,000 regional Australians have already been able to take advantage of the Albanese government’s new Regional First Home Buyer Guarantee,” Minister Collins said.

“The Guarantee is a great opportunity for regional Australians across the country to get into their own home sooner. 

“We want more Australians to have a safe place to call home, and this is just one way we are already delivering.” 

Three-pronged housing affordability attack

As Australia’s housing supply issues continue, exacerbated via rising inflation and central bank “countering” cash rate hikes since May last year, the regional FHB guarantee is just a strategy for “ambitious” housing reform.

Earlier last week, the interim National Housing Supply and Affordability Council met for the first time, the Albanese government highlighted.

Ultimately, the National Housing Supply and Affordability Council Bill 2023 passed the House of Representatives, will now help establish a permanent, statutory council later in 2023, once passed by the Parliament, Ms Collins explained.

Additionally, the Housing Australia Future Fund Bill 2023 also passed the lower house, which was the first step in creating a $10 billion fund, Ms Collins described.

This will facilitate the building of 30,000 new social and affordable housing properties in its first five years, the minister claimed.

Overall, minister Collins said she looked forward to working across the Parliament to deliver the Housing Australia Future Fund. 

“The Fund will be the single biggest investment by a federal government in social and affordable housing in more than a decade, and will provide a secure pipeline of funding for social and affordable housing,” Ms Collins stated. 

The rules of equity eligibility

According to the government, (RFHBG) eligibility is based on applicants being Australian citizens; they must purchase outside a capital city; and they must demonstrate they have been living in the region in which they are purchasing the property (or adjacent regional area) for at least 12 months.

Additionally, property price caps and income caps will be consistent with the existing First Home Guarantee, administered by the National Housing Finance and Investment Corporation (NHFIC). 

[Related: FHBs to lean on home loan deposit schemes]