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

What Help to Buy is

Help to Buy is the federal shared equity scheme, legislated in 2024 and run through Housing Australia. The Australian Government takes an equity stake in 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 co-invest 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 the government co-owns the property you do not pay Lenders Mortgage Insurance. Income and property price caps apply, and the income caps are lower than the First Home Guarantee.

How shared equity works

Shared equity means you and the government own the home together. A simple way to picture it on an existing home: if the government takes a 30% stake, you only need a loan to cover your 68% (the rest of the price after your 2% deposit), instead of a loan for the whole purchase minus your deposit. A smaller loan means smaller repayments, which is what makes an otherwise unaffordable home reachable.

• You own the majority.The government’s stake is a minority share. You hold the title and live in the home as your own.
• 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.

Use our borrowing power calculator to see how a smaller loan changes what you can afford, and our guide to how much deposit you need to plan the 2% you have to bring.

Eligibility, income and price caps

Help to Buy is for owner-occupiers, not investors. The core conditions are consistent, but the dollar thresholds are set by Housing Australia and change, so treat the points below as the shape of the rules rather than fixed numbers.

• Citizenship and age: Australian citizen, aged 18 or over.
• Live in it: You must occupy the home. It cannot be an investment property.
• Don’t own other property: You cannot currently own any other land or property in Australia or overseas. You do not have to be a first home buyer in the strict sense, but you must not be a current owner.
• Income caps: Lower than the First Home Guarantee. These caps are the main thing that decides whether Help to Buy fits your situation.
• Price caps: A maximum property value applies and varies by location, in line with local market conditions.
• Limited places: The scheme has a capped number of places per year, so timing matters.

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 the slice it owns. 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 out the stake 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 make additional payments to buy back the government’s equity in stages, lifting your own ownership until you own the home outright.

• It’s priced at current value. Each buy-out is calculated against what the home is worth at the time, not the original purchase price. If the property has grown in value, buying back the stake costs more than the government first put in.
• It’s done in stages.You don’t have to buy the whole stake at once. There are minimum increments, set by Housing Australia, so you can chip away as your finances allow.
• It frees the upside. Once you own the home outright, all future capital growth is yours, with no share owed to the government.

What happens when you sell

If you still share ownership with the government when you sell, the government receives its proportional share of the sale price. Because its stake is a percentage of the home, that share includes its portion of any capital growth.

• Growth is shared in proportion. If the government owns 30% and the home has doubled in value, it takes 30% of the higher price, not just the dollars it originally contributed.
• You keep your share.The remaining proceeds, after the loan and the government’s share, are yours.
• Selling buys you out.A sale settles the government’s interest, the same way a partial buy-out does, just for the whole stake at once.

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. Whether it works for you depends on how much that growth is likely to be worth against the repayments you save.

Help to Buy vs the First Home Guarantee

Help to Buy and the First Home Guarantee are easy to confuse because both cut the deposit and both waive LMI. They work very differently underneath.

In short: Help to Buy suits buyers who need the smaller loan to make repayments work and accept sharing the upside. The First Home Guarantee suits buyers who can service the bigger loan and want to keep all the growth. Run both past your borrowing power before you commit to either.

What to do next

1. Check the current caps. Confirm the income and price caps for your location with Housing Australia, because they change and they decide your eligibility.
2. Work out your loan size. Use the borrowing power calculator to see how the smaller mortgage under shared equity changes what you can afford.
3. Plan your deposit. Our guide to how much deposit you need covers the 2% you have to bring plus the other upfront costs.
4. Read the full scheme picture. The national First Home Buyer Guide compares Help to Buy against grants, stamp duty concessions and the other federal schemes side by side.