Help to Buy package to be introduced this week

The Albanese government’s pre-election promise of delivering a shared equity scheme to help Australians own their own home faster has moved a step closer, as the government prepares to introduce legislation to create its Help to Buy scheme later this week.

The $329 million scheme will enable up to 40,000 eligible Australians to purchase a property with a minimum deposit of 2 per cent without paying lenders’ mortgage insurance (LMI).

The government will support eligible home buyers with an equity contribution of up to 40 per cent for new homes and 30 per cent for existing homes.  

The scheme aims to help more Australians buy their own home amid a growing cost-of-living crisis and escalating house prices.

Those purchasing a property using Help to Buy will have lower ongoing repayments while they participate in the scheme, which the government said would provide “long‑term relief”. 

While the legislation is set to be introduced this week, the states will still need to pass their own legislation for Help to Buy to operate in their jurisdiction. Several states – including NSW, Victoria, and Tasmania – already run similar shared equity schemes.

Help to Buy will operate in the territories following the passage of Commonwealth legislation.  

All states have already agreed at the national cabinet to progress legislation so that the scheme can run nationally from next year. 

Helping new home owners ‘save hundreds every month on their mortgage’

Speaking of Help to Buy earlier this week, Housing Minister Julie Collins MP said the shared equity scheme would “bring home ownership back into reach for 40,000 Australian households” and be “life-changing for thousands of Australians who have been locked out of the security and stability of home ownership”.

Ms Collins commented: “Right across the country Help to Buy will be life-changing, bringing home ownership back into reach for thousands of Australians, particularly renters. 

“It won’t just be a leg-up into home ownership with savings from a smaller deposit – it will provide long‑term relief to Australians who are part of the scheme.  

“In fact, Help to Buy could help eligible new home owners save hundreds every month on their mortgage.”

The scheme adds to the government’s housing reform package and existing guarantee schemes, which have so far helped more than 86,000 people into home ownership.

Ms Collins said: “Help to Buy will mean even more Australians have this opportunity. 

“Our ambitious housing reform agenda is working across the board – more help for home buyers, more help for renters and more help for Australians needing a safe place for the night.” 

The Albanese government’s housing reform agenda also includes the newly created $10 billion Housing Australia Future Fund and a new national target to build 1.2 million well‑located homes .

Welcoming the news of the Help to Buy scheme, Jocelyn Martin, the managing director of the Housing Industry Association, said: “While the opportunity to own a home can be challenging and the type of homes many families aspire to are changing shape, previous research conducted by HIA shows an overwhelming majority of Australians agree that home ownership matters.

“These and other forms of housing incentive programs are critical to boosting housing supply and home ownership rates to support first home buyers raising the deposit more quickly and easily.

“We know from previous schemes, such as the First Home Buyer Grant, that grants such as Help to Buy, are effective in getting people into their own home and new housing supply is stimulated by these schemes.

“HIA has been a strong supporter of assistance for first home buyers, to help get Australians into their first home and achieve their home ownership aspirations.”

[Related: 1 in 3 first home buyers used guarantee schemes]