Expanded 5% Deposit Scheme has helped 102,594 Australians enter the property market since changes took effect on 1 October 2025. The government removed income caps, lifted property price limits and introduced uncapped places. Victoria, NSW and Queensland account for almost four in five people supported by the assistance.
Borrowing power increases
Eligible first-time purchasers can buy using a deposit of just 5%, which means they do not have to pay lenders mortgage insurance. This lowers the initial savings barrier, yet borrowers still need to demonstrate ability to meet loan repayments. Since the cash rate sits at 4.60%, the affordability assessment becomes especially significant.
In the June 2026 quarter, the typical loan taken by an owner-occupier buying their first home was about $627,000, up from roughly $543,000 in September 2025 – an increase of around $84,000.
Entry versus staying
Entering the property market and remaining secure within it involve distinct difficulties. A reduced down-payment may alter the profile of people who qualify, but it does not generate additional opportunities.
Conditions apply
The support is limited to purchasers who plan to occupy the home themselves; it is not available for investment acquisitions. Buyers are required to take up residence within six months after settlement and remain there for the duration of the government guarantee. Vacating the dwelling and leasing it out may void the guarantee, possibly leading to lenders mortgage insurance or extra charges from the lender.
Michael serves as the director of the independent consultancy Matusik Property Insights. Known for his unbiased, sharp and concise approach, he has guided more than 550 residential projects to completion and authors the well-regarded Matusik Missive. Yet, a smoother path onto the market does not necessarily translate into lower home prices.