First homebuyers offered more hope with home guarantee scheme extension

The industry has been quick to show support for the extension of the federal government’s Home Guarantee Scheme, which will see 40,000 new places open up for all aspirational home buyers in Australia.

The Home Guarantee Scheme comprises the First Home Guarantee, previously known as the First Home Loan Deposit Scheme, and the Family Home Guarantee.

The number of places available through the First Home Guarantee has been increased from 10,000 to 35,000 per financial year, while the Family Home Guarantee now has an annual allocation of 5,000 places from July 1, 2022 until June 30, 2025.

Under the First Home Guarantee, an eligible first homebuyer can purchase a property with a deposit of as little as 5 per cent, while through the Family Home Guarantee a single parent with dependents can purchase a home with a deposit of as little as 2 per cent.

HIA chief executive of industry policy Kristin Brookfield said the guarantees offered help to those Australians looking to buy their first home, recognising that saving for a deposit is the largest obstacle to achieving home ownership.

“With the current cost pressures on households, a first home buyer is facing years to save a deposit and in that time they risk being priced out of the market.

“Since its inception, HIA has been strongly supportive the Home Guarantee Scheme and its administration by the National Housing Finance and Investment Corporation (NHFIC).”

To date, the scheme has helped more than 61,000 Australians get into a home of their own.

Ms Brookfield said the HIA had always maintained that owning your own home was the best form of financial and personal security a person could have.

“The allocation released today takes the scheme from its original pilot phase to a well-accepted part of the home buying landscape in Australia.

“Since its launch, it has been clear that a real problem is being addressed and most importantly that thousands of Australia’s have been assisted to buy their first home.”

NHFIC anticipates making 50,000 new scheme places available to eligible homebuyers in the year ahead, including 10,000 places in the new Regional First Home Buyer Support Scheme.

HIA’s research earlier this year showed 85 per cent of renters in Australia aspired to own their own home, but only 49 percent believed the dream was an achievable one.