With the federal election well and truly in the rear view mirror, we now look at what promises the Labor government made to get into power and how they are going to affect first home buyers going forward.
Help to Buy scheme
The government committed another $800M in the 2025 federal budget to expand access to the current Help to Buy scheme. This includes an increase the allowable property price and increasing income caps. This scheme contributes equity of up to 40% for eligible purchasers and is a shared equity scheme.
Home Guarantee Scheme
All first homebuyers to be eligible for 5 per cent deposits, without needing to pay mortgage insurance. This is huge, and for a first time buyer lending 95% on a $650,000 home would be saving nearly $26,000 in lenders mortgage insurance which when capitalised into the loan is just shy of $500 a month.
HECS-HELP reduction
From June 1, 2025 everyone with a student loan debt will received a 20% reduction to their overall balance (this includes HELP, VET Student Loans, and Australian Apprenticeship Support Loans.). A graduate with an average HELP debt of $27,600 will see about $5,520 wiped from their outstanding loan.
The great news for first home buyers is that this increases your borrowing capacity when you’re looking to take out a loan.
But that’s not all.
Foreign investor and temporary resident ban
In a bid to try and free up more housing for Australians, Labor is planning to place a ban on foreign investors and temporary residents from purchasing any existing homes for a period of two years. They can still buy newly built homes, but anything established will be off the table.
Dedicated new home builds for first home buyers
With big plans to spend $54M building 100,000 new homes for first home buyers, this initiative is longer term and projected to commence in 2027. The scheme is called Homes for Australia and is an extension of a long term plan the government has engaged in over a longer period to improve housing supply and affordability.
There’s lots more being done in other areas including fast tracking building licenses and funding more education for qualified trades, investing in infrastructure and build to rent schemes too.
For more information on current grants and schemes for First Home Buyers head over to our master blog which covers off this topic in great detail or you can download our free First Home Buyer Guide here.