If saving a 20% deposit has felt out of reach, there’s good news coming on October 1, 2025. The Australian Government is expanding the Home Guarantee Scheme (HGS) to make buying your first home more achievable. As a result, it is now easier for first home buyers in Ballarat and regional Victoria to get into a home sooner.
Here’s what’s changing, how the guarantee works, and what it could mean for you.
What’s changing from 1 October 2025
- Unlimited places: As of October 1, there is no cap on the number of guarantees offered by Housing Australia. This means more buyers can take advantage of the scheme without missing out.
- No income caps: Higher earners can also access the scheme.
- Simplified access for regional buyers: Regional pathways are being folded into the main First Home Guarantee to reduce complexity.
Quick refresher: How the HGS works
The HGS helps eligible buyers purchase with a smaller deposit – as little as 5% for first home buyers (and 2% under the Family Home Guarantee for eligible single parents/guardians) – without paying Lenders Mortgage Insurance (LMI).
Importantly, this is not a shared-equity program. The Government doesn’t own a share of your property and doesn’t take a cut of capital gains. Instead, it guarantees up to 15% of the property’s value to your lender, so you’re treated like you’ve put down a full 20% deposit.
Why this matters for Ballarat
- Buy sooner: A smaller deposit gets you into the market faster.
- Avoid LMI: Save potentially $10,000–$30,000+ depending on your loan size.
- $650k price cap: You can buy land in Lucas and choose your own builder or consider house and land packages up to $650k.
What to do next
- Check your deposit position and confirm that you have at least 5% saved (or 2% if eligible under Family Home Guarantee).
- Talk to a broker/lender to confirm eligibility and borrowing power. Note that the price cap at Lucas is $650k.
- Explore House and Land packages under $650k.
- Get your documents ready. ID, income evidence, and savings history help speed up pre-approval from a participating lender.
Find out more and check your eligibility at First Home Guarantee | Housing Australia.
First Home Buyer Glossary
Deposit
The upfront cash contribution a buyer needs to save to secure a loan. Typically, this is 20% of the purchase price. However, under the HGS you may only need a 5% deposit (or 2% for single parents/guardians under the Family Home Guarantee).
Family Home Guarantee
A stream of the HGS designed to support single parents or single legal guardians. Importantly, it lets them buy with a deposit as low as 2%.
First Home Guarantee
A stream of the HGS designed for first home buyers. Importantly, it allows them to enter the market sooner with only a 5% deposit.
Government Guarantor
The government promises the bank it will cover part of the loan (up to 15%) if the borrower defaults. As a result, banks have more confidence to lend. Importantly, the government doesn’t own your home or share in future profits.
Home Guarantee Scheme
An Australian Government initiative that helps eligible buyers purchase a home with a smaller deposit (as little as 5% or 2% in some cases). As a result, they can avoid paying Lenders Mortgage Insurance (LMI).
Income Caps
The maximum yearly income a buyer could earn to qualify. Importantly, these limits will be removed from 1 October 2025, opening the scheme to more buyers.
Lenders Mortgage Insurance
A one-off insurance fee charged by banks, to protect the banks, if you borrow more than 80% of the property’s value. However, the HGS allows you to avoid this cost.
Property Price Caps
The maximum property value eligible under the scheme. As a result, in Lucas the cap is set at $650,000.
Unlimited Places
Previously, the scheme was capped at a set number of spots per year. However, from 1 October 2025, all eligible buyers can access it.
The information provided is general in nature and does not constitute financial, legal, or tax advice. Program eligibility and details may change. Scheme changes commence 1 October 2025. Check details with your lender or adviser.