Help to Buy and your borrowing power
Last updated September 2026 · Back to the calculator
Help to Buy is the Australian Government's shared equity scheme. The government buys part of your home with you, so you need a smaller deposit and a smaller loan. That second part is what makes it different: it is the only first home buyer scheme that reduces the loan the lender tests against your income. (Deposit is not the problem? See the 5% Deposit Scheme instead, and the comparison below.)
What the scheme actually does
- The government's share. Up to 30% of the price for an existing home, or up to 40% for a newly built one.
- Your deposit. At least 2% of the price.
- Your loan. The rest, from a participating lender. There is no Lenders Mortgage Insurance (LMI).
For example, on a $700,000 existing home with a $14,000 (2%) deposit, the government could put in up to $210,000 and your loan would be about $476,000. Without the scheme the same home would need a loan of $686,000.
Why it can lift what you can buy
Lenders work out the largest loan your income can support, using a test rate well above the real rate and the higher of your declared expenses or a benchmark. Help to Buy does not change that test. It changes the price that loan can buy: if the government owns 30%, a loan of $476,000 plus your deposit covers a $700,000 home. Your borrowing power stretches further, up to the price cap for your area.
Who can use it
- Income limits (2026-27): taxable income up to $103,000 for a single applicant, or $165,000 for joint applicants and single parents. The limits are updated each 1 July.
- Property price caps by area, for example $1.3 million in Sydney and regional centres, $950,000 in Melbourne and Geelong, and $1 million in Brisbane. Check the exact cap for your postcode on firsthomebuyers.gov.au.
- You must be 18 or over, an Australian citizen (permanent residents do not qualify, unlike the 5% Deposit Scheme), own no other property in Australia or overseas, and live in the home. Single parents have some exceptions.
- Places are limited to 10,000 a year, and you apply through a participating lender, not the government.
The catches
- The government shares in the gain. When you sell, it takes the same share of the sale price, so a 30% share means 30% of any growth goes back to the government (and it shares any loss).
- Buying it back costs today's value. You can buy back the government's share over time, at least 5% of the home's value each time. There is no interest or rent on its share, but if prices rise, buying back costs more.
- If your income goes over the limit for two financial years in a row, you may be asked to buy back some or all of the share.
- Bigger renovations need notice. Renovations over $21,000, or any needing council approval, go through Housing Australia so you keep the value you add.
- You still need to qualify for the loan. Being eligible for the scheme does not guarantee a participating lender will lend to you.
Help to Buy or the 5% Deposit Scheme?
Both are for first home buyers and both avoid LMI. They solve different problems.
| 5% Deposit Scheme | Help to Buy | |
|---|---|---|
| How it works | Government guarantees part of your loan (up to 15% of the price) | Government buys part of the home (up to 30%, or 40% new) |
| Minimum deposit | 5% | 2% |
| Your loan | Up to 95% of the price | As little as 58% to 68% of the price |
| Who owns the home | You, all of it | You and the government |
| When you sell | You keep all the gain | The government takes its share |
| Income limit | None | $103,000 single, $165,000 joint or single parent |
| Places | No cap | 10,000 a year |
| Price caps | Yes, by area | Yes, by area (lower in Sydney) |
| Best when | Your income supports the loan but your deposit is small | Your deposit is small and your income cannot support a full-size loan |
You cannot use both on the same purchase, but Help to Buy can be combined with state first home owner grants and stamp duty concessions. Our calculator shows what each scheme could reach for you side by side when you say you are a first home buyer.
Before you make an offer
- Get an indicative estimate that includes both schemes (our calculator does this in about 60 seconds).
- Check your taxable income against the limit and the price cap for the property's postcode.
- Check state grants and stamp duty concessions, which can apply as well.
- Talk to a mortgage broker about which scheme suits you and which participating lender to use.
How a broker helps, at no cost to you
- Finds the right lender. Compares lenders across their panel to find which will lend you the most, including those taking part in the 5% Deposit Scheme and Help to Buy.
- Handles the scheme. Checks your eligibility and the price cap, and applies for your scheme place through the lender.
- Gets you ready to bid. Sorts the paperwork and a pre-approval before you make an offer.
Who pays? Most mortgage brokers charge you nothing. The lender you choose pays the broker a commission when your loan settles. By law a broker must act in your best interests, not the lender's. We may receive a referral fee from the broker; it does not change what you pay.
This page is general information only, not credit advice or a recommendation. Scheme rules change; confirm current rules and eligibility with Housing Australia or a licensed broker.