Last updated: April 2026
First Home Guarantee — Eligibility & Price Caps 2026
The First Home Guarantee (FHBG) lets you buy your first home with as little as a 5% deposit while avoiding Lenders Mortgage Insurance (LMI). The government guarantees up to 15% of the property value, bridging the gap between your deposit and the usual 20% required by lenders. Since the October 2025 reforms, there is no income cap and no annual places limit, making the scheme accessible to far more Australians.
October 2025 Reforms
The FHBG was significantly expanded on 1 October 2025. The key changes were:
- Income caps removed: previously $125,000 for singles and $200,000 for couples. Now no income test applies.
- Annual places cap removed: previously limited to 35,000 places per year. Now unlimited.
- Property price caps updated: increased in most states to reflect market conditions.
- Eligibility broadened: includes people who haven't owned property in the last 10 years (not just never-owners).
Property Price Caps by State
| State | Capital City | Rest of State |
|---|---|---|
| New South Wales | $1,500,000 | $800,000 |
| Victoria | $950,000 | $650,000 |
| Queensland | $1,000,000 | $700,000 |
| Western Australia | $850,000 | $600,000 |
| South Australia | $900,000 | $500,000 |
| Tasmania | $700,000 | $550,000 |
| Australian Capital Territory | $1,000,000 | — |
| Northern Territory | $700,000 | — |
How the FHBG Works
Check eligibility
You must be an Australian citizen or permanent resident aged 18+. You must not have owned property (or not in the last 10 years). The property must be within the price cap for your state.
Apply through a participating lender
Contact a participating bank or mortgage broker. The scheme is integrated into the standard loan application process.
Save a 5% deposit
You need at least 5% of the property price as a genuine deposit. FHSS contributions count towards this.
Government guarantees up to 15%
The government acts as guarantor for the gap between your deposit and 20%, eliminating LMI. You still borrow 95% from the lender.
Move in within 6 months
The property must be your principal place of residence. You must move in within 6 months of settlement (note: stamp duty concessions may have separate residency timeframes, e.g. 12 months in NSW).
What the FHBG is NOT
- Not a cash grant: the government does not give you money. It guarantees your loan.
- Not equity sharing: you own 100% of your property. The government has no ownership stake.
- Not free money: you still repay the full 95% loan. LMI is simply avoided.
- Not mandatory: your lender may offer better terms if you have a larger deposit.
Stacking FHBG with Other Schemes
The FHBG can be combined with the FHSS (release super for your 5% deposit), state FHOGs, and stamp duty concessions. It cannot be used together with Help to Buy, as both address the deposit/LMI barrier differently. Use our wizard to find the optimal combination.
See which schemes you qualify for
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Frequently Asked Questions
Is there an income cap for the FHBG?
No. Since 1 October 2025, there is no income cap for the First Home Guarantee. Previously, the cap was $125,000 for singles and $200,000 for couples.
How many places are available?
Unlimited. The annual places cap was removed on 1 October 2025. Previously, only 35,000 places were available per year.
Can I use the FHBG with Help to Buy?
No. These two schemes cannot be used together. You must choose one or the other. The FHBG lets you own 100% of your property, while Help to Buy involves the government taking an equity share.
What happens if I sell the property?
The guarantee is released when you sell or refinance. There is no penalty or repayment obligation. You keep 100% of any capital gains.
Source: Housing Australia
Disclaimer: This information is general in nature and does not constitute financial, legal, or tax advice. Calculations are estimates only and may not reflect your exact circumstances. Eligibility criteria and dollar amounts may change without notice. Always verify with the relevant government authority, your mortgage broker, or a licensed financial adviser before making decisions.