$12,400. On a $620,000 new townhouse in Logan, south of Brisbane, that can be your entire deposit under Help to Buy. No LMI. No bank of mum and dad. No decade of saving while prices move faster than your savings account does.
The Help to Buy scheme Australia launched on 5 December 2025 is the biggest leg-up a federal government has ever offered first home buyers, and the least understood: the Commonwealth co-buys up to 40% of your home, which can shrink your mortgage by six figures, but only a small panel of lenders can currently write the loan. That second detail changes the maths as much as the first.
The timing matters too. The RBA cash rate sits at 4.35% after hikes in February, March and May 2026, held steady in June, with the next decision due on 11 August 2026. Rising rates cut what lenders will approve, which stings most for the low-to-moderate income buyers this scheme targets. But the same cycle has pushed auction clearance rates into the low 40s (Cotality, June 2026). Fewer bidders. More room to negotiate. For a prepared buyer, this is an advantage window, and a scheme that removes up to 40% of your loan lands at exactly the right moment. If you are earlier in your research, start with our first home buyer guide for 2026 and come back.
How does Help to Buy actually work?
Think of the Commonwealth as a silent co-buyer. It puts up a share of the purchase price through Housing Australia, takes an equity stake in your home to match, and charges you no rent and no interest on that stake. You live there. You hold the title. The government owns a slice of the value until you buy it back or sell.
The core settings:
| Setting | Help to Buy (from 1 July 2026) |
|---|---|
| Government equity share | Up to 40% (new homes), up to 30% (existing homes) |
| Minimum deposit | 2% of the purchase price |
| LMI | None payable |
| Income caps | $103,000 (singles), $165,000 (joint applicants) |
| Rent or interest on the government share | None |
| Buying the government out | Voluntary payments over time (generally in minimum 5% slices, at market value), or settle up when you sell |
| Property price caps | Vary by state and city; check Housing Australia's current caps before you shortlist suburbs |
Eligibility runs along familiar lines: Australian citizens aged 18 or over, income under the caps, not currently holding property in Australia, and you must live in the home. Housing Australia publishes the full criteria, and the fine print is worth reading before you fall in love with a floor plan.
You still need to qualify for the loan itself. A 2% deposit gets you in the door; a lender's serviceability calculator decides whether you walk through it.
What changed on 1 July 2026?
Two settings moved at once. From 1 July 2026 the income caps sit at $103,000 for singles and $165,000 for joint applicants, and the government added 10,000 places on top of the original allocation.
Follow that through. A couple on $82,000 each fits under the joint cap. So does a single teacher on $98,000, or a retail manager on $101,000. The caps sit exactly at the band of buyers who earn too much for social housing support and too little to service a full Brisbane-priced mortgage at today's rates. If your household income sits anywhere near those numbers, the question is no longer "do we qualify?" but "is this the right scheme for us?", and that is a comparison worth doing properly. Our FHG vs FHSS vs Help to Buy breakdown puts the three side by side.
More places also means the scheme is less of a lottery than its state-level predecessors were. Less scarcity, less panic, better decisions.
What's the catch with shared equity?
Owning 60% of the home you live in beats owning 0% of the home you rent. Hold that thought, because the catch list below is real but it is not a reason to walk away. It is a reason to model before you sign.
The government's share grows with your home. Its stake is a percentage of value, not a fixed dollar amount. Say that $620,000 Logan townhouse grows 20% over five years to $744,000. A 40% government share is now worth $297,600, which means $49,600 of your capital growth belongs to the Commonwealth. You gave up growth to get in sooner. Sometimes that trade is brilliant. It depends on the suburb, the timeframe, and what rent would have cost you in the meantime.
The income caps follow you after settlement. Your income is tested annually, and if you exceed the cap for two consecutive years you will generally need to start buying the government out. A promotion, a second job, a partner returning to full-time work: all of it counts. If your income is heading up fast, map that trajectory before you apply, not after.
You carry 100% of the running costs. Rates, insurance, body corporate, the hot water system that dies in July. All yours, even while you own 60%.
Buying back costs market price, not cost price. Those 5% slices are valued at the time you buy them, so repurchasing after strong growth costs more than the government originally paid in. Buying back early and steadily usually beats one big cheque later.
Same buyer, two schemes: which loan gets approved?
Meet Jade, an early childhood educator in Logan on $78,000, looking at a new $620,000 townhouse. Same buyer. Two paths.
Path A, the Australian Government 5% Deposit Scheme (formerly the First Home Guarantee): Jade needs a $31,000 deposit and borrows $589,000. At an illustrative 6.00% over 30 years, repayments run about $3,531 a month. On $78,000, with the new lender testing her at 9.00% under APRA's 3% buffer, that loan is unlikely to pass serviceability at all.
Path B, Help to Buy: Jade needs $12,400. Housing Australia contributes 40%, $248,000, and her loan is $359,600. Same illustrative rate: about $2,156 a month, roughly $1,375 less than Path A, and a loan her income can carry through the buffer test.
The gap: $18,600 less deposit, a monthly repayment that fits, and an approval that exists versus one that probably does not. The trade is that $248,000 of equity share. For Jade, Help to Buy is not just cheaper; it is the only path that gets her a yes this year. And because it is a new build in Queensland, she pays no stamp duty either, with no price cap, under the 2026 first home buyer changes covered in our stamp duty guide.
Based on typical scenarios. Individual outcomes vary. Rates shown are illustrative only, not advertised rates; actual rates and comparison rates vary by lender and change over time.
Buyers with bigger savings should run the numbers the other way. If you have 8% or 12% saved, a guarantee-scheme loan or a low-deposit loan without shared equity may leave more growth in your pocket. Our guide on how much deposit you actually need walks through the thresholds.
Does the small lender panel matter?
More than most coverage admits. The panel today is Commonwealth Bank, Bank Australia and, since late July 2026, the Teachers Mutual Bank group (writing through brokers from 6 October 2026), with further expansion expected through 2026. A scheme built on choice currently offers a menu of three: three pricing sheets, three credit policies, three sets of turnaround times.
We've watched scheme buyers assume Housing Australia's approval is the whole approval. It isn't. The lender runs its normal credit assessment first and the scheme second, and its serviceability calculator, tested at your rate plus the 3% buffer, decides whether the loan exists at all.
This is where comparing paths beats picking a scheme off a headline. The Wity Borrowing Power Assessment models your capacity across 45+ lenders, then sets the Help to Buy panel's numbers beside the wider market, so you can see in dollars whether a smaller loan from a three-lender panel beats a bigger loan with dozens of lenders competing for it. For some buyers the equity share wins by a mile. For others, a standard low-deposit path gets a similar result with none of the shared-equity strings.
What should you do before 11 August?
Whichever way it goes, borrowing power is not getting easier while you wait, and the expanded Help to Buy places will not sit unclaimed forever.
Three moves this month. Check your household income against the $103,000 or $165,000 cap. Check Housing Australia's price cap for your city. Then get both paths modelled on your actual numbers before you commit to either.
Want that done properly? Book a 15-minute call with our first home buyer team and we'll walk you through Help to Buy against the alternatives. Or start the Wity questionnaire: free, no credit check, two minutes.