The Help to Buy scheme is the Australian Government's shared equity program designed to help eligible Australians get into home ownership with a smaller deposit and a smaller ongoing mortgage. If you've been struggling to save enough for a deposit while property prices keep moving, this scheme is worth understanding.
This guide explains how Help to Buy works, who's eligible, which properties qualify, and how it compares to other first home buyer programs available in 2026.
What is the Help to Buy Scheme?
Help to Buy is a shared equity scheme, which means the federal government takes a co-ownership stake in your home. This isn't a loan — it's an equity contribution. In exchange for that contribution, you need a smaller deposit and you borrow less money, which means lower monthly repayments.
The government contributes:
- Up to 40% of the purchase price for a new home
- Up to 30% of the purchase price for an existing home
You contribute a minimum deposit of 2% (your own genuine savings) and borrow the rest. Because the government's contribution isn't a debt you're repaying, your loan size is significantly smaller — and you don't pay Lenders Mortgage Insurance (LMI) on the government's portion.
A Simple Example — How It Works in Practice
Let's say you're buying an existing home in Melbourne's northern suburbs for $650,000.
| Without Help to Buy | With Help to Buy (30%) | |
|---|---|---|
| Property price | $650,000 | $650,000 |
| Government contribution | — | $195,000 (30%) |
| Your deposit (2% minimum) | $130,000 (20% to avoid LMI) | $13,000 |
| Your loan amount | $520,000 | $442,000 |
In this scenario, Help to Buy dramatically reduces both your deposit requirement and your loan size. Your monthly repayments are lower, you can get into the market sooner, and you don't need years more of saving.
Who Is Eligible?
Help to Buy has specific eligibility requirements. As of 2026, the key criteria are:
- Australian citizen (permanent residents are not eligible)
- 18 years or older
- Income limits apply: up to $90,000 per year for singles, up to $120,000 combined for couples (before tax)
- You must not currently own any other property in Australia or overseas
- You must intend to live in the property as your principal place of residence
- You must have a minimum 2% genuine savings deposit
- You must be able to service a home loan for the remainder of the purchase price
Which Properties Qualify in Melbourne?
Not all properties are eligible. The scheme applies to residential properties within set price caps. For Victoria in 2026, the price caps are:
| Area | Price Cap |
|---|---|
| Melbourne metropolitan area | $950,000 |
| Regional Victoria | $700,000 |
The property must also be:
- A residential property (houses, townhouses, units, apartments)
- Already built or under construction (off-the-plan purchases may be eligible)
- Intended as your primary residence — not for investment
How Do You Buy Out the Government's Share?
The government's equity stake doesn't stay forever — you can buy it back over time. There are a few ways this happens:
- Voluntary buy-back: At any time, you can make capital repayments to increase your own equity share. There are minimum thresholds for each buy-back, but you can gradually increase your ownership to 100% when you're financially ready.
- When you sell: On sale, the government receives its proportional share of the sale price. If the government owned 30% and the property sells for $750,000, the government receives $225,000.
- If you no longer meet the requirements: For example, if your income exceeds the cap, the government may require you to begin buying out the equity share.
The government does not charge rent on its equity stake — that's a key difference from some other co-ownership models.
Help to Buy vs the First Home Guarantee
Melbourne home buyers often ask how Help to Buy compares to the First Home Guarantee (FHBG). They're quite different:
| Help to Buy | First Home Guarantee | |
|---|---|---|
| How it helps | Government co-owns part of the property; you borrow less | Government guarantees your LMI so you can buy with 5% deposit |
| Deposit required | As low as 2% | As low as 5% |
| Your loan size | Smaller (government owns a share) | Full purchase price minus deposit |
| Income cap | $90K single / $120K couple | $125K single / $200K couple |
| Government takes equity? | Yes — you share in growth and sale proceeds | No — you own 100% of the property |
| Best for | Buyers with very little savings but steady income | Buyers with 5% deposit who want full ownership from day one |
For many Melbourne buyers, the right scheme depends entirely on your savings position, income, and how important full ownership is to you from the start. A conversation with a first home buyer loan specialist can help you compare your options side by side.
How to Apply for Help to Buy
- Check your eligibility against the income and citizenship requirements
- Get pre-approved for the remaining loan portion with an approved lender — a mortgage broker can help you with this step
- Apply to Housing Australia for a Help to Buy allocation
- Once approved, find a property within the price caps
- Enter into a co-ownership agreement with Housing Australia
- Complete your purchase with your approved lender
Frequently Asked Questions
- Does the government make money from the Help to Buy scheme?
- The government shares in the property's capital growth proportionally to its equity stake. If the property goes up in value, the government's share increases in value too. If it goes down, the government shares in that loss. Importantly, the government does not charge rent on its share — this makes Help to Buy very different from paying rent.
- Can I renovate or change my Help to Buy property?
- There are rules around this. Major renovations or structural changes typically require approval from Housing Australia, and any value added through improvements can affect the equity calculation when you eventually buy out the government's share or sell. Minor maintenance and cosmetic improvements are generally fine.
- What happens if I want to sell the property?
- When you sell, the government receives its proportional share of the sale price. For example, if the government owned 30% and the property sells for $700,000, the government receives $210,000 from the sale proceeds. You keep the remainder, including any of your own capital growth.
- Is Help to Buy better than the First Home Guarantee?
- They serve different purposes. The First Home Guarantee lets you buy with a 5% deposit without paying LMI, but you take on the full loan yourself. Help to Buy reduces both your deposit and your loan size by having the government co-own part of the property. Help to Buy makes buying more affordable on a month-to-month basis; the First Home Guarantee suits buyers who have 5% saved and want to own 100% from day one.
- Can I use Help to Buy to buy an investment property?
- No. Help to Buy is strictly for owner-occupiers. You must live in the property as your principal place of residence.
Thinking About Help to Buy?
We can help you check your eligibility, compare it against other first home buyer programs, and get your loan pre-approved before you start searching for a property. Book a free 15-minute call with Brian or Frank today.
Book a Free Call Or call Brian on 0401 333 636Integrated Finance Group is a credit representative of BLSSA Pty Ltd (Australian Credit Licence 391237). Brian Hermosilla — Credit Representative 485802. Frank Marin — Credit Representative 486546. This article is general information only and does not constitute financial or credit advice. Government scheme eligibility criteria and price caps are subject to change — always verify current details with Housing Australia or a qualified mortgage broker. Your individual circumstances will determine which products and schemes are appropriate for you.