Help to Buy Scheme Australia: How the Shared Equity Scheme Works (2026)

Under Help to Buy, your lender’s approval letter states the most you can pay, and going even slightly over the price cap disqualifies the purchase. Plan well under it and leave room to negotiate.

What Help to Buy is

Help to Buy is the federal shared equity scheme, legislated in 2024 and run by Housing Australia through participating lenders. The Australian Government contributes part of the price of the home you buy, which means you borrow less and need a much smaller deposit. It is one of several first home buyer schemes covered in our national First Home Buyer Guide.

The headline figures: the government can contribute up to 40% of the price of a new home or up to 30% of the price of an existing home. You provide a deposit of as little as 2%, and because your deposit and the government’s share together reach at least 20%, you don’t pay Lenders Mortgage Insurance. Applications opened on 5 December 2025, and by 1 July 2026 more than 7,200 people had applied and 4,800 had found a home or settled.

How shared equity works

Shared equity means the government funds part of the purchase and is repaid a matching share of the home’s value later. On an existing home with a 30% government share, your loan only needs to cover 68% of the price (the rest after your 2% deposit), instead of the whole price less your deposit. A smaller loan means smaller repayments, which is what makes an otherwise unaffordable home reachable.

• The home is yours. It’s in your name and you live in it as your own. The government’s contribution is secured by a second mortgage.
• Your loan is smaller. Because the government funds part of the purchase, you borrow less and your monthly repayments are lower than a standard purchase at the same price.
• No LMI. The small deposit doesn’t trigger Lenders Mortgage Insurance, the way it normally would below a 20% deposit.

What a 30% government share means

A single buyer on $95,000 buys a $700,000 existing home in Melbourne with a 2% deposit and the government’s full 30%. Here it is next to the same home under the 5% Deposit Scheme:

Help to Buy saves $1,194 a month in repayments here. In exchange, the government’s 30% follows the home’s value: it put in $210,000 and receives $240,000 on an $800,000 sale. Try your own figures in the Help to Buy calculator.

Eligibility and income limits

Help to Buy is for owner-occupiers, not investors. To be eligible you must:

• Be an Australian citizen aged 18 or over. Permanent residents are not eligible; get your citizenship certificate first.
• Earn under the income limit for 2026–27: $103,000 taxable income as a single, $165,000 combined for a couple, or $165,000 as a single parent. It’s tested on your most recent ATO notice of assessment, with no exceptions for one-off bonuses. The limits were $100,000 and $160,000 until 30 June 2026 and are indexed every 1 July.
• Not own property now. You can’t own land or property in Australia or overseas when you apply, but you don’t have to be a first home buyer: previous owners can apply. Single parents have limited exceptions.
• Live in the home. Move in at settlement for an established home, or within 3 months of completion for a new build.
• Need the help. There’s no fixed asset test, but the lender checks your finances, and if you could buy without the scheme, you’re not eligible.
• Take one principal and interest loan from a participating lender, for up to 30 years. At most two people can apply together.

Price caps by state

The home must cost no more than the cap for its area. The higher cap covers each capital city and, in three states, named regional centres. Caps haven’t changed since the scheme started and aren’t indexed.

Regional centres on the higher cap: Newcastle and Lake Macquarie, Illawarra, Central Coast, Mid-North Coast, Coffs Harbour–Grafton, Richmond–Tweed in NSW; Geelong in Victoria; and Gold Coast and Sunshine Coast in Queensland. Jervis Bay Territory and Norfolk Island have a $550,000 cap, and Christmas Island and the Cocos (Keeling) Islands $400,000.

Do you pay rent on the government’s share?

No. This is the question that worries most people looking at shared equity, and the answer is straightforward: you do not pay rent or interest to the government on its share. You repay only your own home loan, the same as any other owner. The government’s return comes later, from its share of the home’s value when you buy it back or sell.

Buying out the government’s stake

You are not locked into the arrangement for the life of the loan. As your income grows, you can buy back the government’s share in stages until you own the home outright.

• It’s priced at current value. Each repayment is based on a valuation at the time, not the original price, and you pay for the valuation. If the home has grown in value, buying back the share costs more than the government first put in.
• It’s done in steps of at least 5%. Each repayment must be at least 5% of the home’s current value, or the whole remaining share.
• It frees the upside. Once you own the home outright, all future growth is yours.

What happens when you sell

You can sell at any time, but you must tell Housing Australia and the sale must be at arm’s length. The government receives its percentage of the sale price or a valuation, whichever is higher. The proceeds repay your bank first, then the government’s share, and the rest is yours.

• Growth is shared in proportion. If the government holds 30% and the home has doubled in value, it takes 30% of the higher price, not just the dollars it put in.
• Losses are shared too. Its share is a percentage of the value, so if the home is worth less, so is its share.

This is the genuine trade-off of shared equity: a smaller loan and easier entry now, in exchange for a share of the growth later.

Living with Help to Buy

If your income goes up

Housing Australia reviews your income at least every five years. Only being over the limit for two years in a row triggers anything: the lender then checks whether you can afford to buy back at least 5% of the home’s value. If you can, you pay within 90 days; if you can’t, it’s reassessed after 12 months or more. You’re never required to repay if it would push you into Lenders Mortgage Insurance.

Renovating

Tell Housing Australia before work costing $21,000 or more in 12 months, or any work that needs council approval. The government’s share is then adjusted so you keep the value you add. If you don’t tell them, there’s no adjustment.

Renting it out

Not allowed, and nor is business use. The exceptions, with Housing Australia’s approval, are Defence Force postings, an employer relocation after 12 months in the job (up to 12 months, extendable twice), and serious illness or compassionate grounds.

Refinancing

You can move to another participating lender, with a part or full buy-back if you like. Moving to any other lender means repaying the government’s share in full. Extra borrowing is allowed only to reduce the government’s share, for repairs or improvements, or in hardship.

Separation and death

A participant can be removed only if the lender confirms the other can manage the loan, or under a court order, and at least one original participant must stay. If an owner dies, up to two eligible beneficiaries can take over; otherwise the government’s share is recovered, usually within two years. A surviving joint owner carries on and must tell Housing Australia within 90 days.

How to apply, lenders and places

You apply through a participating lender, or a broker that works with one. You can’t apply to Housing Australia directly.

1. The lender assesses you and submits a conditional approval, which reserves a place for 90 days (one 90-day extension is possible).
2. You get an approval letter with your maximum purchase price, and a letter of support to show sellers.
3. Your contract must allow at least 30 days to settlement; the lender needs everything 29 days before.
4. After final approval you must settle within 90 days. Housing Australia’s conveyancer arranges the participation agreement and the second mortgage.

Places: 10,000 a year, shared between the states by population, with unused places carried over and 40,000 in total. From 1 March each year, uncommitted places can be used in any state. Housing Australia doesn’t publish how many are left. There are no application fees; you pay the usual costs plus the registration of the government’s mortgage.

Combining it with other schemes

• Can’t combine: the 5% Deposit Scheme and the rest of the Home Guarantee Scheme, any other shared equity scheme (including state schemes such as Queensland’s Boost to Buy), and state home-ownership loans or guarantees.
• Can combine: your state’s first home owner grant, stamp duty concessions, and the First Home Super Saver Scheme.

Our guide to shared equity schemes in Australia lists each state’s scheme and whether it’s still open.

Help to Buy vs the 5% Deposit Scheme

Help to Buy and the 5% Deposit Scheme (the expanded First Home Guarantee) both cut the deposit and both avoid LMI, but they work very differently, and you can only use one.

In short: Help to Buy suits buyers who need the smaller loan to make repayments work and accept sharing the upside. The 5% Deposit Scheme suits buyers who can service the bigger loan and want to keep all the growth. The worked example above shows the gap in repayments on the same home.

The downsides

• You share the growth on the government’s slice, and buying it back costs today’s value, plus a valuation each time.
• You can’t rent it out except in narrow cases, which limits your options if your plans change.
• Renovations need notice once they reach $21,000 in 12 months, or you lose the value you add.
• Few lenders offer it (4 as of 7 October 2026), so you have less choice of rate and features.
• Higher income later can mean being asked to buy back part of the share.
• No stacking with the 5% Deposit Scheme or state shared equity schemes.

Help to Buy in your state

The scheme’s rules are national, but the price caps, first home grants, stamp duty concessions and state schemes differ:

• Help to Buy in Queensland
• Help to Buy in New South Wales
• Help to Buy in Victoria
• Help to Buy in Western Australia
• South Australia ($900,000 in Adelaide, $500,000 elsewhere), Tasmania ($700,000 in Hobart, $550,000 elsewhere), the ACT ($1,000,000) and the NT ($600,000): see the shared equity schemes guide for the state schemes.

What to do next

1. Check your figures. The Help to Buy calculator tests your income and price against the limits and shows your repayments.
2. Work out your borrowing power. Use the borrowing power calculator to see what the smaller loan lets you afford.
3. Plan your upfront costs. Our guide to how much deposit you need covers the 2% plus stamp duty and the other costs.
4. Talk to a participating lender or someone who works with them. Ask your bank whether it is one, or use a broker who works with the participating lenders.