Particle.news
Download on the App Store
4 ARTICLES
·
last wk.

Expanded Home Guarantee Caps Take Effect Oct. 1, Opening Far More Markets to First‑Home Buyers

Cotality modelling points to a sharp rise in eligible areas alongside likely price pressure from added demand.

Image
The federal government will expand its Home Guarantee Scheme in October, lifting income and property caps to give first-time buyers greater access, but it will also fast-track price rises, a new analysis has found.
Image

Overview

  • From October 1, eligible buyers can purchase with a 5% deposit as the Commonwealth guarantees 15% of the loan, allowing them to avoid lenders’ mortgage insurance.
  • Price caps rise to $1.5 million in Sydney, $950,000 in Melbourne, $1 million in Brisbane and $850,000 in Perth, with higher thresholds in most regions and the removal of income limits.
  • Cotality finds the share of analysed markets under the caps jumps from about one-third to 63.1% nationally, including 51.6% of house markets and 93.7% of unit markets.
  • The modelling warns that if recent growth persists, roughly 100 newly accessible suburbs could exceed the new caps within about three months, with examples including Bankstown and Springvale.
  • Economists and industry figures say buyers must still meet lender affordability tests, and they caution the demand-side boost could push prices higher even as it broadens access for those without family financial support.