Great news about the Home Guarantee Scheme Being Extended

Home Guarantee Scheme Extended

There was some great news yesterday when the Australian Government announced that they were looking to extend the Home Guarantee Scheme and also introduce a new Guarantee Scheme specifically for regional buyers.

These announcements come on top of the previously introduced programs for First Home Buyers and Single Parent Families.

The government has revealed how much it expects to spend on its expanded Home Guarantee Scheme, with this year’s budget spelling a large focus on the regions.

Treasurer Josh Frydenberg handed down the 2022-23 federal budget on Tuesday (29 March), revealing a $78 billion deficit (3.4 per cent of GDP). For the previous year, there had been a $79.8 billion deficit.

The cost of living as fuel prices surge, omicron and the effects from the recent floods in NSW and Queensland had taken priority for the government, among other factors.

“The global pandemic is not over. Devastating floods have battered our communities,” Mr Frydenberg said. “We live in uncertain times. The last two years have been tough for our country, there have been setbacks along the way.”

“Over the last year, 160,000 Australians purchased their first home. In this budget we go further, more than doubling the Home Guarantee Scheme to 50,000 places per year.” Mr Frydenberg said.

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 – $900,000 from $800,000 before Rest of state – $750,000 from $600,000 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
• 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
• Other Areas – Jervis Bay Territory and Norfolk Island; and Christmas Island and Cocos (Keeling) Islands have seen no changes, with their respective caps remaining at $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.

If you have more questions relating to your specific scenario, click here to reach out to one of our Lending Specialists today to learn more. You can also call the team on 1300 665 906.