5% Deposit Scheme 2026: price caps and who qualifies

The scheme, previously called the First Home Guarantee, works through a government guarantee of up to 15% of the property’s value. That lets the lender treat a 5% deposit as if it were 20%, so no LMI is charged. See what it means for your upfront costs in the LMI and upfront costs calculator (tick the 5% Deposit Scheme box).

Property price caps

State or territory	Capital city and regional centres	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
ACT	$1,000,000	n/a
Northern Territory	$750,000 (Darwin)	$600,000

Who is eligible

• Australian citizen or permanent resident, aged 18 or over (both applicants if buying with someone)
• A first home buyer, or have not owned property in Australia in the last 10 years
• Buying a home to live in, and moving in within 6 months of settlement
• At least a 5% deposit, but less than 20% of the property’s value
• One applicant or two joint applicants, never three
• No income cap and no limit on places since 1 October 2025

Single parents and single legal guardians of a dependent child can buy with a 2% deposit under a separate stream, and do not have to be first home buyers.

How much it saves

Take a first home buyer purchasing a $750,000 established home in NSW:

Cost	5% deposit with the scheme	5% deposit without the scheme
Deposit	$37,500	$37,500
LMI (estimate)	$0	$27,182
Stamp duty (first home buyer)	$0	$0
Fees and inspections (estimate)	$3,600	$3,600
Cash needed upfront	$41,100	$41,100 plus LMI added to the loan

Compared with saving a full 20% deposit of $150,000, the scheme can get a buyer into the market years sooner. The trade-off is a bigger loan, so repayments are higher: $4,503 a month on a $712,500 loan at 6.50% over 30 years.

Rule changes from 1 July 2026

• Retained savings limit: for places reserved from 1 July 2026, you can’t keep more than 6 months of living expenses plus 6 months of loan repayments in savings after settlement. The rest is expected to go into the purchase.
• Refinancing: borrowers switching between participating lenders can add eligible refinancing costs to the new loan.

Things to check before you apply

• Not every lender offers the scheme. Apply through a participating lender or a broker who works with them.
• Both the price and the lender’s valuation must be under the cap.
• You still need to pass the lender’s serviceability test, including the 3% buffer. See how the buffer works and test your numbers in the borrowing power calculator.
• You can combine the scheme with state stamp duty relief and the First Home Owner Grant. See stamp duty exemptions by state.

Not eligible, or want to compare options? Read what LMI costs, other ways to avoid LMI, and the Help to Buy shared equity scheme. Then run the full numbers in the upfront costs calculator.

Frequently asked questions