First home buyers: From Renting to Owning: Your First Home Is Closer Than You Think

You have been renting for years, watching property prices and wondering whether the window has passed. It probably has not. A cluster of federal and state schemes has materially shifted the numbers for first home buyers, and understanding how they stack together is worth the time before you dismiss the idea.

The Federal Layer: First Home Guarantee

The First Home Guarantee is a federal government scheme that lets eligible first home buyers purchase with as little as a 5% deposit, with no Lenders Mortgage Insurance (LMI) to pay. The government guarantees up to 15% of the value, bridging the gap to 20% without the buyer having to fund it.

From 1 October 2025, the scheme became significantly more accessible: no income caps, no place limits, and higher property price caps across the country. Previously, singles earning above $125,000 and couples above $200,000 were excluded. That test is gone.

The headline price caps for 2026 are: Sydney and NSW regional centres at $1,500,000; Brisbane and Queensland regional centres (Gold Coast, Sunshine Coast) at $1,000,000; Melbourne and Geelong at $950,000; Perth at $850,000; and Darwin at $750,000. Caps are set by Housing Australia and reviewed periodically, so confirm the cap for your specific postcode before signing anything.

To be eligible, you must be an Australian citizen or permanent resident aged 18 or over, be a genuine first home buyer (meaning you have never owned property in Australia, or have not owned property in the past 10 years), and purchase the property as your primary place of residence. Investment properties are not eligible.

Your income affects your borrowing capacity through standard serviceability assessments, but no longer disqualifies you from the scheme itself.

The Super Layer: First Home Super Saver Scheme

The First Home Super Saver Scheme (FHSS) lets you use voluntary super contributions to build part of your deposit inside the superannuation environment, where the tax treatment is more favourable than saving in a standard account.

The FHSS limits are $15,000 per financial year and $50,000 in total across your lifetime. Couples can both use the scheme. Two first home buyers pooling their FHSS can release up to $100,000 plus associated earnings toward a shared deposit.

How the release works:

• Your releasable amount can include 100% of eligible non-concessional contributions, 85% of eligible concessional contributions, and associated earnings.
• The ATO calculates associated earnings using the Shortfall Interest Charge rate (the 90-day Bank Accepted Bill rate plus 3%), compounded daily from the start of the financial year each contribution was made.
• The assessable amount is taxed at your marginal rate less a 30% offset.

You must request an FHSS determination from the ATO before ownership of any property transfers to you. If you release funds and do not sign a contract within 12 months of the request (generally extended to 24 months), you must either recontribute the amount to super or pay FHSS tax of 20%.

The FHSS is worth discussing with a licensed financial adviser or SMSF specialist accountant, particularly to confirm how your planned contributions sit against the concessional cap. A salary sacrifice amount used for FHSS still counts toward the concessional contributions cap, which for 2025-26 is $30,000.

The State Layer: Stamp Duty Concessions and Grants

Stamp duty is often the hidden cost that derails a first home purchase. Most states now offer meaningful relief. As a general guide at the time of writing:

• NSW: Full stamp duty exemption for a new or existing home valued up to $800,000, with a concessional (reduced) rate for homes valued over $800,000 and under $1,000,000, tapering to full duty at $1 million.
• VIC: Full exemption where the dutiable value is $600,000 or less, with a concession on a sliding scale for dutiable value from $600,001 to $750,000, phasing out to full duty at $750,000.
• QLD: First home concession on existing homes with no transfer duty where the home is valued at $700,000 or under, with a partial concession phasing out between $700,000 and $800,000. For contracts entered into on or after 1 May 2025, a full transfer duty concession with no price cap applies on new homes.

Always verify thresholds with your state revenue office before exchanging contracts, as these rules change.

Queensland also runs a First Home Owner Grant. Queensland offers a $30,000 First Home Owner Grant for eligible new homes valued below $750,000, and the increased grant continues for eligible contracts signed from 1 July 2026.

A Worked Scenario

Consider two buyers, one in Brisbane and one in Sydney, each earning $110,000 and buying as owner-occupiers.

Brisbane buyer, new house-and-land package, $680,000:

• First Home Guarantee: 5% deposit ($34,000), no LMI.
• Stamp duty: $0 on a new home from May 2025, no price cap.
• Queensland FHOG: $30,000 cash grant toward costs.
• FHSS (if they contributed $15,000 per year for three years): up to $50,000 in eligible contributions plus deemed earnings releasable, taxed at their marginal rate less the 30% offset.

Sydney buyer, existing apartment, $820,000:

• First Home Guarantee: 5% deposit ($41,000), no LMI.
• Stamp duty: concessional rate applies between $800,000 and $1,000,000, so a partial reduction rather than a full exemption.
• FHSS: same mechanics apply, capped at $50,000 total.

These figures are illustrative only. Actual amounts depend on individual circumstances, lender serviceability assessments, and the specific contract date. No return or outcome is implied.

What to Do Next

If the above framework describes your situation, three practical steps move this from reading to action:

1. Get a borrowing capacity assessment. A licensed mortgage broker can run your numbers against current lender criteria and confirm whether you qualify under the First Home Guarantee. The scheme is administered through participating lenders, not all lenders offer it.
2. Model your FHSS position. A licensed financial adviser or SMSF specialist accountant can confirm how many years of contributions you have available to count, how they interact with your concessional cap, and what your net release would look like given your marginal rate.
3. Check your state concession eligibility early. Stamp duty concessions are determined at contract date in most states. Speak with your solicitor or conveyancer before you sign anything.

If you want to understand how new construction fits into the picture, including how EWC's HomePay product works (zero monthly payments for the first 12 months during construction, then standard repayments), visit /services or book a call to step through the specifics with us. You can also browse further articles at /insights.

General information only, not personal financial advice. Speak with a licensed adviser before acting.