Help to Buy scheme 2026: what the higher income caps and 10,000 new places mean for first home buyers

5 August 2026 · First home buyers · 7 min read

If you've been priced out of the deposit hurdle rather than the repayments themselves, the federal government's shared-equity scheme just got easier to qualify for. Housing Australia has confirmed changes to the Australian Government Help to Buy Scheme from 1 July 2026, aimed at supporting more Australians into home ownership sooner. Housing Australia announced that 10,000 new places will be available for the 2026-27 financial year across all states and territories, alongside increased income eligibility thresholds. The scheme is now also genuinely national — its expansion to Tasmania in June 2026 marked its full national rollout, with the Scheme now available across all states and territories.

The headline change is the income test. From 1 July 2026, taxable income limits increased to $103,000 for single applicants and $165,000 for joint and single parent applicants, building on the Scheme's strong early uptake. That's not a huge jump, but for borrowers who were sitting just above the old thresholds, it's the difference between qualifying and not. Uptake so far suggests real demand for the pathway — since the Scheme launched, Help to Buy has received more than 7,200 applications, with 4,800 of these applications having found a home to live in (or having settled) and the remaining looking for a home.

How Help to Buy actually works

Help to Buy is a shared-equity scheme, not a grant or a loan top-up. The government becomes a part-owner of your home in exchange for contributing to the purchase price, which shrinks the mortgage you need to service. Help to Buy enables home buyers to purchase a home sooner with a deposit of as little as 2 per cent, with the Australian Government contributing up to 40 per cent of the purchase price for new homes and up to 30 per cent for existing homes, subject to eligibility criteria. You still need to be assessed for a standard home loan on the remaining share, arranged through one of the scheme's participating lenders.

That equity share cuts both ways. A smaller mortgage means smaller repayments and less lenders' mortgage insurance exposure, but when you sell — or choose to buy back the government's share early — you repay that same percentage of the sale price, including its slice of any capital growth. It's worth working through that trade-off with a broker before you commit, particularly if you expect to renovate, extend, or hold the property for the long term, since all three can affect what you owe the government share on exit.

Who's actually using it

The applicant profile so far tells you a lot about who this scheme is built for. Almost 7 out of 10 applications are from single applicants, including 12 per cent who are single parents, and with a median deposit of $30,000 and 86 per cent first-home buyers, Help to Buy is a critical pathway into home ownership for Australians with limited savings. Demand has been strongest in the eastern states — the strongest demand is in Victoria, followed by New South Wales and Queensland. If you've been saving alone, or juggling a single income against today's price caps, this is precisely the cohort the expanded thresholds are meant to reach.

One practical limitation to flag: applications currently run through only two participating lenders, Commonwealth Bank of Australia and Bank Australia, though Housing Australia has flagged plans to expand the lender panel through 2026. That narrows your choice of loan product and rate compared with going it alone on a standard first-home loan, which is one reason it's worth comparing the full picture — Help to Buy, the First Home Guarantee, and a conventional low-deposit loan — before locking in a strategy.

Illustrative example: comparing the deposit hurdle

This example is illustrative only and doesn't reflect a real applicant or guaranteed outcome. Consider a single first-home buyer earning $95,000, looking at a $650,000 new-build apartment. Under a standard loan, a 10% deposit would mean saving roughly $65,000 plus costs before even applying. Under Help to Buy, with the government contributing toward the purchase price in exchange for an equity share, the buyer's own deposit requirement could be as low as 2% — a materially smaller savings target, though the mortgage itself is not the only cost; the buyer still needs to meet standard lending criteria on the remaining loan share, and understand what repaying the government's share will look like at resale. Whether this pathway suits a given borrower better than a standard loan or the First Home Guarantee depends on income, the property's price cap, and how long they intend to stay put — which is exactly the kind of comparison a broker can run before you sign anything.

What this means if you're weighing up your options now

If falling into the old income brackets kept you out of Help to Buy, it's worth re-checking your eligibility under the new caps before assuming the scheme still isn't for you. It's also worth stress-testing the comparison against a standard loan and against schemes like the First Home Guarantee, since each has a different mix of deposit requirements, lender panels, and long-term cost. None of these pathways guarantee approval or a particular financial outcome — eligibility, lending criteria, and price caps still apply, and a licensed broker can help map out which option actually fits your numbers.

Common questions

Do I still need lenders' mortgage insurance under Help to Buy?
Generally no — because your deposit contribution combined with the government's equity share typically keeps your borrowed portion below the threshold that triggers LMI, though this depends on the specific loan and lender.

Can I use Help to Buy alongside the First Home Guarantee?
No — these are separate first-home pathways with different eligibility rules, and you'd need to choose one or the other for a given purchase. A broker can help you compare which suits your income, deposit and target property.

What happens to the government's share when I sell?
You repay the same percentage of the sale price that the government contributed, which includes its share of any capital growth (or loss) since purchase — not a fixed dollar amount.

Am I locked into the two participating lenders forever?
You apply through a participating lender at purchase, but Housing Australia has indicated the lender panel is expected to grow through 2026, which may open up refinancing options for existing Help to Buy participants down the track.

For a deeper look at how the current market backdrop is shaping first-home decisions, see our earlier piece on falling home values and first home buyers. You can also explore our first home buyer hub, use our borrowing power calculators to model a smaller Help to Buy-style loan, or start with our first home buyer enquiry page if you're ready to talk to a broker.

General information only — not credit advice. Credit assistance is provided by a licensed mortgage broker.