Australian Government 5% Deposit Scheme (Home Guarantee)

How it works

The Australian Government gives a guarantee to a Participating Lender, which can then lend the buyer up to 95% (first home buyers) or 98% (single parents or legal guardians) of the home’s value. You still have to meet the lender’s own credit policy and loan approval criteria. Being eligible for the scheme does not guarantee you a loan.

Who is eligible

All applicants must:

• be an Australian citizen or permanent resident, at least 18 years old;
• buy a home in Australia priced at or below the location’s price cap;
• plan to live in the home as an owner-occupier (no investment properties);
• apply for an owner-occupier loan with principal and interest repayments from a Participating Lender, for up to 30 years (plus up to three years to build a new home).

First home buyers must also have saved a minimum 5% deposit and have not owned a property or land in Australia in the last 10 years. You can apply alone or with one other person, such as a partner, friend or family member.

Single parents or legal guardians need a minimum 2% deposit, must be single (a person separated but not divorced is not single), and must not own another home or property interest once the new home settles. They apply on their own, with no joint applications. They do not have to be first home buyers. The official page is not clear on how the rules apply to a legal guardian who is not the natural or adoptive parent, so confirm that with a Participating Lender.

The scheme pages describe several kinds of home: new or existing houses, townhouses, apartments, house and land packages, off-the-plan purchases, and vacant land with a building contract.

Property price caps (as published, fact sheet of 1 July 2026)

Both the purchase price and the home’s value assessed by the lender must be at or below the cap.

The regional centres are Central Coast, Coffs Harbour-Grafton, Illawarra, Mid North Coast, Richmond-Tweed, and Newcastle and Lake Macquarie in NSW; Geelong in Victoria; and the Gold Coast and Sunshine Coast in Queensland. Jervis Bay Territory and Norfolk Island have a cap of $550,000, and Christmas Island and the Cocos (Keeling) Islands $400,000. For a new home built on vacant land under separate contracts, the land price plus build costs must come in under the cap. Some suburbs have more than one postcode with different caps, so use the official postcode tool and confirm with your lender.

Steps to apply

1. Check your eligibility with the official online eligibility tool.
2. Contact a Participating Lender, which assesses your eligibility and submits the application. Documents include identification, proof of citizenship or residency and a Home Buyer Declaration form.
3. Once pre-approved, you have 90 days to find a home and sign a contract of sale. See home loan pre-approval.
4. After you sign the contract, your lender manages the final approvals.

Conditions after you buy

You must move into the property within six months of settlement and keep living there while the guarantee is active. If you do not move in on time or you move out before the guarantee ends, your lender may require you to pay LMI. A property with tenants is allowed as long as you move in within the six months.

Related schemes

The official site also lists the First Home Super Saver Scheme (see the guide) and the Help to Buy shared equity scheme, with applications open from 5 December 2025 and a government contribution of up to 30% or 40% of the price; check its own conditions on firsthomebuyers.gov.au. The Regional First Home Buyer Guarantee has closed to new applicants; regional buyers now apply as first home buyers or as single parents or legal guardians.

Which professional to consult

A mortgage broker can tell you which lenders in your state are Participating Lenders and what they require (mortgage brokers). A conveyancer handles the contract and settlement (conveyancers).