In this blog/video, we discuss the Government's recently announced fast tracked First Home Guarantee scheme, to 01 October 2025 - buy a property with just a 5% deposit, no LMI, and higher price caps (up to $1m in Brisbane).

This is a rare chance for first home owners to get into the market sooner - but bigger loans mean bigger risks. Know the rules before you sign...

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Hi everybody - George Sourris, Empire Legal.

Today's topic: Fast tracked 5% Deposit First Home Guarantee: What first home buyers need to know - NOW!

On Monday the 25th of August 2025, the Australian Government announced it will fast track the expanded First Home Guarantee, bringing the start date forward to 01 October 2025. This move is designed to help first home buyers get into the market sooner and with less financial pressure.

Okay, so what's changed?

An earlier start date - the scheme is now launching in October 2025 instead of 2026.

Wider access - so all first home buyers will be able to apply with no caps on income.

Higher property price limits - for example,

• up to $1,000,000 in Brisbane (previously $700,000).
• up to $700,000 in regional Queensland (previously $550,000).
• up to $1,500,000 to spend in Sydney; and
• up to $950,000 in Melbourne.

Now if you're outside these areas, you can find out about the thresholds for other cities and regional areas from Housing Australia here.

But for all Brisbane-ites, you've got a million dollars to play with. That's pretty cool.

Lower deposit requirement  -  buyers can purchase now with as little as a 5% deposit.

No lender's mortgage insurance - the government provides a guarantee to the bank, which means big savings for buyers.

So why does this matter?

The average Australian home now costs $844,000. A 20% deposit means saving over $168,000, taking years to achieve. With the First Home Guarantee, buyers only need 5%, which can save up to a decade of time savings, and tens of thousands of dollars in LMI fees.

5% of $844,000 is $42,200. And if the bank of mum and dad can help with some of that amount, you're already there, right off the bat. For many young Australians, this is a once in a generation opportunity to get into the property market sooner. 

People of my vintage didn't have these sort of opportunities available to us. So if you're a youngin' or a first home buyer and you're looking to get into the market, it doesn't get any better than this offering.

Some key benefits:

Accessibility - removing income limits and lifting price caps means more people qualify.

Time savings - so buyers can also step onto the property market ladder earlier. LMI relief - removing one of the biggest upfront costs.

Lending options - the scheme is supported not only by the major banks, but also smaller lenders. 

Important considerations.

Whilst the scheme is generous, there's some risks and responsibilities buyers need to understand.

Higher loan amounts - a 95% loan means higher repayments and interest over time.

Equity risk - with only a 5% deposit, buyers have less buffer if property values dip.

Market impact - there may be concerns for easier access pushing pricing higher, especially if housing supply doesn't keep up.

We do have a major housing supply problem here in Australia. On the flip side guys, if you are in early, that means your property should appreciate more, with only 5% to get into the market.

Quick tips for buyers. There's four of them.

1) Check your eligibility early. These price caps depend on location.

2) Compare lenders. Whilst LMI is now removed, some banks may charge higher interest rates on low deposit loans.

3) Plan long term. Getting in sooner is great, but consider your ability to manage repayments if rates rise, like it did after COVID when we went from 2% to 6%.

4) Thinking beyond the scheme. So buying a home involves legal checks, contracts, and long-term commitment. Always get proper advice. 

The final word.

The First Home Guarantee is designed to give more Australians a fair shot at home ownership. It can save you years of savings and tens of thousands of dollars in upfront costs. In the first year alone, first home buyers using the scheme are expected to avoid around $1.5 billion in potential LMI fees alone.

Housing Industry Association managing director Jocelyn Martin said: the scheme helped more than 210,000 Australians get into a home that they own so far. Previously, the scheme has been capped at 50,000 new applicants every year.

But today's announcement will mean there is no capital or income limit and property prices have been adjusted in line with the average housing prices in both metropolitan and regional areas, Ms Martin said.

If you want to read the transcript highlights from the Prime Minister's media release, we have the link available here.

Please note like any financial decision that's major, it's important to understand both the opportunities and the risks before you sign a contract. Very topical blog this week, guys. It affects a huge chunk of our population. If you're a first home buyer, this is such a unique opportunity to get yourself into the market.

Please like, subscribe, and share. Ideally, if you want to send this to a first home buyer so they can learn a little bit more, that's all we ask.

Guys, that's it for this week. Hope you learned a thing or two. Please feel free to get in touch if you've got any questions. Empire Legal - happy to help. Queensland's trusted choice for conveyancing. Over 2,700 Google reviews with a five star average. There's not many firms out there that have that five star average. With that many reviews, guys, and not to mention over 12,000 deals settled. Thanks guys. We'll see you next week.

Finally, if you haven't heard, we've launched our podcast. It's called Raising the Bar, where we story tell excellence in Queensland property. Here is the link to listen. If you prefer to watch, here is the YouTube link.

Also, stay up to date with our miniseries on Seller's Disclosure.

Thanks guys. We'll see you next week!

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Thanks for reading everybody. See you on the next one.

Ladies and gentlemen, please keep in mind that all advice is general in nature and does not constitute legal advice. This is authorised by George Sourris, Empire Legal, Brisbane, Queensland, Australia.

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Note: all information is general in nature and as each matter is unique please contact our office for tailored advices: the above does not constitute legal advice.