Overview

• Effective 1 October, the scheme lets eligible first‑home buyers purchase with a 5% deposit as the government guarantees the balance to 20%, removes income and place limits, lifts price caps (Sydney to $1.5m) and abolishes the annual places cap after merging regional guarantees.
• Home values rose 0.8% in September for an eighth straight monthly gain, and agents report buyers rushing to transact with some listings jumping from about $750,000 to near $800,000 ahead of the rollout.
• Treasury modelling points to a 0.5% rise in prices over six years, but outside forecasts warn of larger short‑term effects, including up to 10% in year one, with impacts likely concentrated in lower‑priced segments.
• A 5% deposit implies a 95% loan‑to‑value mortgage, lifting monthly repayments and total interest costs by tens to hundreds of thousands of dollars over the life of the loan and increasing the risk of negative equity if prices fall.
• Brokers say higher‑earning buyers newly eligible under the rules are entering at higher budgets as the government pitches the change as helping young Australians, and lenders are competing with sharper rates for scheme participants.