Government boosts max property prices for home guarantees

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By Sarah Simpkins20 April 2022

Prime Minister Scott Morrison has promised higher property price caps for new buyers under the Home Guarantee Scheme from July.

Tens of thousands more consumers are expected to benefit from the new property price caps under the Home Guarantee Scheme from 1 July, after the program was expanded to 50,000 places per year in the recent federal budget.

The First Home Guarantee and Regional Home Guarantee schemes allow eligible buyers to purchase a home with a deposit as small as 5 per cent, while the government guarantees up to 15 per cent of the property price – allowing the buyer to skip lender’s mortgage insurance.

The Family Home Guarantee on the other hand allows single parents with dependent children to purchase homes with a deposit as small as 2 per cent.

The new price caps across states will now apply during the 2022-23 financial year:

  • NSW
    Capital city and regional centres – $900,000 from $800,000 before
    Rest of state – $750,000 from $600,000 before
  • Victoria
    Capital city and regional centres – $800,000 from $700,000 before
    Rest of state – $650,000 from $500,000 before
  • Qld
    Capital city and regional centres – $700,000 from $600,000 before
    Rest of state – $550,000 from $450,000 before
  • WA
    Capital city and regional centres – $600,000 from $500,000 before
    Rest of state – $450,000 from $400,000 before
  • SA
    Capital city and regional centres – $600,000 from $500,000 before
    Rest of state – $450,000 from $350,000 before
  • Tasmania
    Capital city and regional centres – $600,000 from $500,000 before
    Rest of state – $450,000 from $400,000 before
  • ACT
    Capital city and regional centres – $750,000 from $500,000 before
  • NT
    Capital city and regional centres – $600,000 from $500,000 before
  • Jervis Bay Territory and Norfolk Island; and Christmas Island and Cocos (Keeling) Islands have seen no changes, with their respective caps being $550,000 and $400,000.

The capital city price thresholds apply to regional centres with a population over 250,000 – including Newcastle and Lake Macquarie, Illawarra (Wollongong); Geelong; Gold Coast and Sunshine Coast.

There will be 35,000 places available in a year under the First Home Guarantee (formerly the First Home Loan Deposit Scheme, or FHLDS) from July, up from the current 10,000. 

The Family Home Guarantee will have an additional 5,000 guarantees each year from July to 30 June 2025. 

[Source: Mortgage Business – https://www.mortgagebusiness.com.au/property/16709-government-boosts-max-property-prices-for-home-guarantees]

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