First-home help: FHSS and guarantees

Lenders want you to bring a meaningful slice of the purchase price yourself — Moneysmart's buying-a-house guide sets out the traditional benchmark — plus enough on top to cover buying costs like stamp duty, legal work and inspections. Bring less than the benchmark and the loan usually still happens, but with lenders mortgage insurance added: a premium that protects the lender, not you (the full story is in our LMI explainer).

So the deposit problem is really two problems: the headline pile (a slice of an ever-moving price) and the drag (while you save, prices and rents keep moving). That second part is what makes official help genuinely valuable — most of it works by attacking the years, not the dollars: letting you buy earlier with less, or making the saving itself faster.

Three kinds of help exist, and they're not competitors — they stack. A government guarantee that shrinks the deposit a lender demands and removes LMI; the First Home Super Saver scheme, which lets deposit savings grow in super's concessional tax environment; and state help — stamp duty exemptions or concessions, and grants in some places. The rest of this page takes them one at a time.

Under the Home Guarantee Scheme — run by Housing Australia, and flagged in Moneysmart's guide — the government guarantees part of an eligible buyer's loan. The lender, no longer exposed on that slice, will lend against a much smaller deposit without charging LMI. Streams exist for first home buyers, regional buyers and single parents or guardians; eligibility rules, property price caps and settings change with budgets, so the current details live with Housing Australia and participating lenders.

Understand what the guarantee is not. It is not a grant — no money is given to you — and it doesn't make the home cheaper. It converts years of extra saving into extra borrowing: you start with a bigger loan, thinner equity, and larger repayments than the buyer who brought the full deposit. That's often still a great trade — years of rent while saving aren't free either — but it's a trade, not a gift.

Which means the real test for the guarantee isn't "do I qualify?" but "can I comfortably service the bigger loan?" Run the repayments at more than today's rates (our Mortgage tool makes that easy), leave your buffer intact after settlement, and treat the thin-equity years with respect — with little equity, a dip in prices can put the loan briefly underwater, which only matters if you're forced to sell into it.

The First Home Super Saver scheme, run by the ATO, lets you build deposit savings inside super — where contributions and earnings enjoy concessional tax — and later release them to buy your first home. You add voluntary contributions (salary sacrifice from pre-tax pay, or after-tax top-ups — the same channels described on Moneysmart's contributions page), and when you're ready to buy, you apply to release those contributions plus deemed earnings.

The boundaries matter. Only voluntary contributions can come back out — never your employer's compulsory super, which stays for retirement. Annual and lifetime caps limit how much counts toward the scheme, and released pre-tax contributions carry their own tax treatment with an offset — the current caps and rates live at the ATO. The win, roughly, is that money routed through super's lower tax rates leaves more of your own pay ending up in the deposit than the same saving done from taxed take-home pay.

And one rule deserves bold type: get the ATO's release determination before you sign anything. The scheme has strict sequencing around requesting your savings and signing a contract, and getting it wrong can cost you access to your own money at the worst moment. It's paperwork before house-hunting gets exciting — do it early.

The states run their own first-buyer help, and the biggest piece is usually stamp duty relief: exemptions or concessions that can remove one of the largest cheques at settlement. Moneysmart's advice is simply to check your state's current rules — every jurisdiction sets its own thresholds and conditions, and they change often (our stamp duty explainer covers how the tax itself works). Some states add first home owner grants, typically for new builds; the state revenue office is the source of truth.

The pieces are designed to stack: an eligible buyer can save via FHSS, buy under a guarantee, and settle with a stamp duty concession — each attacking a different cost. Eligibility rules differ per piece (income tests, price caps, first-home definitions, residency requirements), so qualifying for one doesn't mean qualifying for all; check each against your actual situation, not the headline.

Last, keep the decision bigger than the discounts. Help schemes make buying easier, not owning cheaper — rates move, repairs arrive, and the costs around a purchase run well past the deposit (see Hidden costs). The right first home is the one whose repayments survive a bad year, with or without every scheme in the stack.