Finance
The Australian Government has launched a new initiative to support first home buyers on middle to low range incomes in purchasing their first home. This is called the First Home Loan Deposit Scheme and it provides first home buyers with the opportunity to purchase a home with as little as a 5% deposit and avoid paying Lenders Mortgage Insurance (LMI).
Launched on the 1st of January 2020, the FHLDS scheme will support up to 10,000 loan applications each year.
We've gathered the most popular questions related to the First Home Loan Deposit Scheme and have rounded up our experts answer your questions below.
A guide to deposits, pre-approval, & choosing the right property.
Updated: 22 June 2021
The Federal Government has since announced changes to the First Home Loan Deposit Scheme, revealing that it plans to reissue unused guarantees from the first stage of the scheme.
What happened in 2020 was that the scheme proved to be very popular, with places in the scheme becoming exhausted within a few months of launching. However, for various reasons some first home buyers did not end up finalising their purchase meaning that approximately 2,000 guarantees were not settled.
Approximately 1,800 of these unused guarantees from the 2019-2020 financial year will now be reissued to allow for more first home buyers to enter the property market. This update, along with the low interest rates of 2021, is likely to be encouraging for first home buyers. First home buyers must apply for these remaining places through a participating lender before 30 June 2021.
Additionally, from 1 July 2021, a further 10,000 places in the scheme will be introduced for the 2021-2022 financial year.
The federal government has announced that property price caps will increase for homes purchased under the First Home Loan Deposit Scheme, as well as the Family Home Guarantee. This will provide first home buyers with greater access to the property market.
In most locations, price cap limits will rise by at least $50,000, with the ACT being the only state/territory to retain its current price cap of $500,000 for the upcoming financial year.
Here are the updated price caps under the First Home Loan Deposit Scheme and the Family Home Guarantee, commencing 1 July 2021:
Capital city | Rest of state/territory | |
---|---|---|
NSW | $800,000 | $600,000 |
VIC | $700,000 | $500,000 |
QLD | $600,000 | $450,000 |
WA | $500,000 | $400,000 |
SA | $500,000 | $350,000 |
TAS | $500,000 | $400,000 |
ACT | $500,000 | - |
NT | $500,000 | - |
Search an address for price estimates and sales history.
Yes, you can. The FHLDS can be combined with other state and territory based home buying assistance programs such as the First Home Owner Grant (FHOG). This means that as well as buying a home with a lower deposit, you may be able to avoid paying all or a part of your stamp duty tax.
Find out if you can save with a lower interest rate.
A guide to deposits, pre-approval, & choosing the right property.
Recognising that dwellings in regional centres tend to be significantly more expensive than other regional areas, the capital city price thresholds for the FHLDS also apply to regional centres with a population over 250,000 (the Gold Coast, Newcastle and Lake Macquarie, the Sunshine Coast, Illawarra (Wollongong) and Geelong).
State/territory | Capital city and regional centres | Rest of state/territory | Other |
---|---|---|---|
NSW | $700,000 | $450,000 | |
VIC | $600,000 | $375,000 | |
QLD | $475,000 | $400,000 | |
WA | $400,000 | $300,000 | |
SA | $400,000 | $250,000 | |
TAS | $400,000 | $300,000 | |
ACT | $500,000 | - | |
NT | $375,000 | - | |
Jervis Bay Territory and Norfolk Island | - | - | $450,000 |
Christmas Island and Cocos (Keeling) Islands | - | - | $300,000 |
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Applications can be lodged through participating lenders, with help from a Lendi Home Loan Specialist. You can see if you qualify by clicking here and choosing a time to chat with an expert.
So there you have it, the First Home Loan Deposit Scheme explained. If you have any home loan questions or want to see if you are eligible for the FHLDS, then jump on the Lendi platform or chat to a Home Loan Specialist here.
Find out how much you could borrow with our calculator.
We're here to help. Get free expert advice at a time that suits you. Choose a time to chat with a Home Loan Specialist here.
The information in this post is general in nature and should not be considered personal or financial advice. You should always seek professional advice or assistance before making any financial decisions.
Tags: saving, interest rate, new purchase, first home buyer, first home owners grant, first home, first property
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