Northern Beaches Mums Group
Northern Beaches Mums Group

Increased Accessibility for Home Buyers

More Australians (and permanent residents!) will soon be eligible for a leg up into the property market under an expanded Home Guarantee Scheme.

Officially unveiled as part of the 2023 federal budget, the expanded Home Guarantee Scheme will have broader eligibility criteria from 1 July 2023.

So, if you’re a single parent or guardian, first home buyer, haven’t owned property for a decade, permanent resident, or looking to buy a home with your friend or sibling – be sure to read on to find out if you’re eligible.

What is the Home Guarantee Scheme?

Getting a deposit together can be a massive hurdle when buying a home. And if your deposit is lower than 20%, you can get stung with lender’s mortgage insurance (LMI), which can cost you anywhere between $4,000 and $35,000 depending on the property price and your deposit amount. But through the NHFIC, the federal government has three low deposit, no LMI schemes.

This means if you’re eligible, you won’t need to wait until you’ve reached the standard 20% deposit.

The First Home Guarantee and Regional First Home Buyer Guarantee support eligible buyers to purchase a home with a low 5% deposit and no LMI. And the Family Home Guarantee assists eligible single parents to buy a home with a deposit of just 2% and no LMI.

Access to these schemes can, on average, bring forward the home-buying process by five years!

It’s worth noting there is an eligibility criteria, which covers property types, locations and prices. But an experienced broker (that’s us!) will be across all the ins and outs to help you work out if you qualify.

What are the upcoming changes?

Good news if you are among the increasing number of Australians joining with friends, siblings, and other family members to buy a home.

Come 1st July 2023, you may be eligible to lodge a joint application under the First Home Guarantee and Regional First Home Buyer Guarantee; previously you could only apply as an individual or married/de facto couple.

Meanwhile, the Family Home Guarantee is set to expand to include single legal guardians, such as an aunt, uncle or grandparent. Previously it was only for eligible single natural or adoptive parents.

All three schemes will expand to eligible borrowers who are Australian permanent residents, in addition to citizens. And all three guarantees will include eligible borrowers who haven’t owned a property in Australia in the last ten years.

What do you need to know?

The Home Guarantee Scheme can be a great way to fast-track getting into the property market. But you’ll have to get in quickly because places are strictly limited.

That includes 35,000 places per financial year across the First Home Guarantee, 10,000 places per financial year under the Regional First Home Buyer Guarantee, and 5,000 places per financial year under the Family Home Guarantee.

Also, not all lenders are involved with the scheme, but we can help you to identify and compare participating lenders. So give us a call today to get the ball rolling.

habits might look to a lender, get in touch today and we can help you start to smooth things out.

Louisa Sanghera is a Finance Broker for Residential Mortgages, Vehicle and Asset Finance, Commercial Lending and Budgeting and Cashflow Coaching with Zippy Financial.

She has gained more than 30 years in the Banking and Finance Industry, and since founding Zippy Financial, has become a multi award nominated expert in the field of finance featuring regularly in industry press and speaking at finance and investment seminars across the country.

Phone: 1300 855 022

Disclaimer:This article contains information that is general in nature. It does not take into account the objectives, financial situation or needs of any particular person. You need to consider your financial situation and needs before making any decisions based on this information. This article is not to be used in place of professional advice, whether business, health or financial.