The First Home Guarantee Calculator models your home loan purchase under the Australian Federal Government's Home Guarantee Scheme (HGS), administered by Housing Australia. The First Home Guarantee (FHBG) allows eligible first-home buyers to purchase a residential property with as little as a 5% deposit without paying expensive Lenders Mortgage Insurance (LMI).

How the First Home Guarantee Scheme Works

Under standard Australian mortgage lending guidelines, purchasing a property with less than a 20% deposit (a Loan-to-Value Ratio or LVR above 80%) requires paying Lenders Mortgage Insurance. LMI can cost between $10,000 and$ 35,000+, added directly onto your loan balance.

Under the First Home Guarantee:

Buyer Contribution: You provide a genuine savings deposit between 5% and 19.99%.
Federal Government Guarantee: Housing Australia guarantees up to 15% of the property value to the participating lender.
LMI Exemption: Because the lender's risk is secured up to 80% LVR, no Lenders Mortgage Insurance is charged, saving first-home buyers thousands of dollars upfront.

Eligibility Criteria & Scheme Caps

To qualify for the scheme through a participating bank or non-bank lender:

First-Home Buyer Requirement: Applicants must be Australian citizens or permanent residents aged 18+ who have not owned residential property in Australia in the prior 10 years.
Taxable Income Thresholds:
- Single applicants: Annual taxable income up to $125,000.
- Couples / joint applicants: Combined annual taxable income up to $200,000.
Owner-Occupier: The property must be purchased as a primary place of residence.
Property Price Caps (2025–2026):
- NSW (Sydney & Regional Centres): $900,000 (Rest of State:$ 750,000)
- VIC (Melbourne & Regional Centres): $800,000 (Rest of State:$ 650,000)
- QLD (Brisbane & Regional Centres): $700,000 (Rest of State:$ 550,000)
- WA (Perth & Regional Centres): $600,000 (Rest of State:$ 450,000)
- SA (Adelaide & Regional Centres): $600,000 (Rest of State:$ 450,000)
- ACT: $750,000 | **TAS**:$ 600,000 | NT: $600,000

Step-by-Step Worked Example: Melbourne Purchase

Suppose you are purchasing a home in Melbourne for $750,000 with a 5% deposit:

Standard Mortgage Without Scheme

Purchase Price: $750,000
5% Deposit: $37,500
Base Loan Amount (95% LVR): $712,500
Estimated Lenders Mortgage Insurance (LMI): ~$28,500
Total Initial Loan: $741,000

With the First Home Guarantee (FHBG)

Purchase Price: $750,000
5% Deposit: $37,500
Government Guarantee (15%): $112,500
LMI Payable: $0
Total Initial Loan: $712,500
Direct Upfront Savings: $28,500 saved in LMI!

Frequently Asked Questions

Does the government own a share of my home?

No. The First Home Guarantee is not a shared equity scheme. Housing Australia acts purely as a financial guarantor to the bank. You own 100% of the property and retain all future capital gains.

Can I combine the First Home Guarantee with Stamp Duty exemptions?

Yes. Eligible first-home buyers can combine the Federal First Home Guarantee with state-based first-home buyer concessions, such as the First Home Owner Grant (FHOG) and full or partial Stamp Duty exemptions.

Are places in the scheme limited?

Yes. Housing Australia releases 35,000 First Home Guarantee places annually across participating major banks and regional lenders on July 1st of each fiscal year. Pre-approval with a participating lender secures a reserved allocation.

First Home Guarantee Calculator