What’s the difference between the Family Home Guarantee and First Home Guarantee?
The Family Home Guarantee and First Home Guarantee are both designed to help eligible Australians enter the property market with a lower deposit, but the two schemes are intended for different types of buyers. While each program may allow eligible applicants to avoid paying Lenders Mortgage Insurance (LMI), the eligibility requirements, target buyers, and overall purposes of the schemes differ.
The First Home Guarantee is aimed at eligible first home buyers looking to purchase or build their first property sooner, while the Family Home Guarantee is designed to support eligible single parents or single legal guardians with dependent children. Both schemes operate through Housing Australia and participating lenders, but factors such as income limits, deposit requirements, and buyer eligibility can vary by program.
Understanding how these government schemes compare can make it easier to choose a pathway that aligns with your financial situation, homeownership goals, and plans for building or buying a new home.
Key differences between the Family Home Guarantee and First Home Guarantee
While both schemes are designed to help eligible buyers enter the property market sooner with a lower deposit, there are important differences between the Family Home Guarantee and First Home Guarantee. The main differences relate to who can apply, minimum deposit requirements and the type of buyer each housing scheme is intended to support.
|
Feature |
Family Home Guarantee |
First Home Guarantee |
|
Target buyer |
Eligible single parents or single legal guardians with dependent children |
Eligible first home buyers |
|
Minimum deposit |
From 2% deposit |
From 5% deposit |
|
Previous property ownership |
Buyers may have previously owned a property |
Buyers must generally be first home buyers |
|
Purpose of the scheme |
Supports single parents entering or re-entering home ownership |
Helps first home buyers purchase their first property sooner |
|
Lenders Mortgage Insurance (LMI) |
Eligible buyers can avoid LMI |
Eligible buyers can avoid LMI |
|
Eligibility criteria |
Based on income limits, dependent children and lender requirements |
Based on first home buyer eligibility and income requirements |
|
Property options |
Eligible established homes, new builds and house and land packages |
Eligible established homes, new builds and house and land packages |
|
Managed through |
Housing Australia and participating lenders |
Housing Australia and participating lenders |
Understanding these differences can help buyers compare which scheme may better align with their financial situation, homeownership goals, and eligibility requirements before applying through a participating lender.
Who is eligible for the Family Home Guarantee vs First Home Guarantee?
Eligibility requirements are among the biggest differences between the Family Home Guarantee and the First Home Guarantee. While both schemes are designed to support eligible buyers with lower deposit home loans, the criteria used to determine who can apply vary depending on the scheme and borrower type.
Family Home Guarantee eligibility
The Family Home Guarantee is designed for eligible single parents or single legal guardians with at least one dependent child. Applicants may qualify even if they have previously owned a property, provided they meet the current scheme requirements set by Housing Australia.
Eligibility is generally based on:
- Income caps and financial eligibility requirements
- Having one or more dependent children
- Australian citizenship or permanent residency requirements
- Applying through a participating lender
- Meeting relevant property price caps
The scheme is intended to support single parents Australia-wide who may otherwise find it difficult to save a larger deposit while balancing everyday living expenses.
First Home Guarantee eligibilit
The First Home Guarantee is designed for eligible first home buyers looking to purchase or build their first property sooner with a lower deposit. Unlike the Family Home Guarantee, applicants generally must not have previously owned or had an interest in residential property in Australia.
Eligibility is commonly based on:
- First home buyer status
- Income caps for individuals or joint applicants
- Australian citizenship or permanent residency requirements
- Applying through a participating lender
- Meeting property price cap requirements
For many first home buyers, the scheme provides an opportunity to enter the property market sooner without the need for a larger upfront deposit or Lenders Mortgage Insurance.
Deposit requirements: Family Home Guarantee vs First Home Guarantee
The minimum deposit required under each scheme is one of the main differences between the Family Home Guarantee and First Home Guarantee. While both programs are designed to help eligible buyers access home loans sooner and avoid paying Lenders Mortgage Insurance (LMI), the deposit threshold varies by borrower type and scheme eligibility.
Family Home Guarantee
From 2% deposit
Designed for eligible single parents or single legal guardians with dependent children seeking a lower-deposit pathway into homeownership.
Includes:
- Deposit from as little as 2%
- No Lenders Mortgage Insurance for eligible buyers
- Available through participating lenders
- Suitable for eligible established homes, new builds and house and land packages
- Borrowing capacity assessed by the lender
First Home Guarantee
From 5% deposit
Designed for eligible first home buyers looking to purchase or build their first property sooner.
Includes:
- Deposit from 5%
- No Lenders Mortgage Insurance for eligible buyers
- Available through participating lenders
- Suitable for eligible established homes and new home purchases
- Income and borrowing assessments apply
Can you build a new home or use house and land packages with these schemes?
Both the Family Home Guarantee and First Home Guarantee may apply to eligible new builds and house and land packages, giving buyers more flexibility when choosing how they want to enter the property market. Depending on lender requirements and scheme eligibility, buyers may be able to purchase land alongside a building contract, buy a newly built home or build a personalised home that better suits their lifestyle and future needs.
For many buyers, building a new home can provide advantages such as modern layouts, energy-efficient inclusions and access to growing communities across Melbourne and Regional Victoria. Eligible property types may include house and land packages, newly constructed homes, off-the-plan purchases and vacant land combined with a building contract.
While both schemes can support lower-deposit homeownership pathways, participating lenders will still assess borrowing capacity, financial commitments, and property eligibility before approving finance. Buyers should also carefully review building contracts and confirm that the chosen property meets relevant scheme price caps and lending requirements before proceeding.
Pros and cons of the Family Home Guarantee vs First Home Guarantee
Both government schemes are designed to help eligible buyers enter the property market sooner with a lower deposit, but each option comes with different advantages and limitations depending on the buyer’s financial situation and eligibility.
|
Scheme |
Pros |
Cons |
|
Family Home Guarantee |
|
|
|
First Home Guarantee |
|
|
Which scheme is better for first home buyers vs single parents?
The right scheme will depend on the buyer’s financial situation, home ownership goals and eligibility requirements. While both the Family Home Guarantee and First Home Guarantee are designed to help eligible Australians enter the property market sooner with a lower deposit, each scheme is tailored to a different type of buyer.
For eligible first home buyers who have not previously owned residential property, the First Home Guarantee may provide a more suitable pathway into home ownership. The scheme is designed to support buyers looking to purchase or build their first home with a lower deposit while avoiding Lenders Mortgage Insurance (LMI).
For eligible single parents or single legal guardians with dependent children, the Family Home Guarantee may offer greater flexibility through its lower 2% deposit requirement. The scheme is designed to support buyers who may be re-entering the property market or balancing family expenses while working towards owning a home.
In many cases, the better option comes down to scheme eligibility, borrowing capacity and long-term financial goals. Speaking with a participating lender can help buyers compare home loan options, understand government scheme requirements and determine which pathway may better align with their circumstances.
How property price caps differ between the two schemes
Property price caps are an important part of both the Family Home Guarantee and First Home Guarantee, as they determine the maximum property value eligible under each scheme. While both programs use price caps set by Housing Australia, the limits can vary depending on the scheme, property location and whether the home is being purchased in a metropolitan or regional area.
Family Home Guarantee property price caps
The Family Home Guarantee follows property price caps established by Housing Australia for eligible purchases across Australia. These caps are designed to reflect different property markets and can vary between capital cities, regional locations and regional limits in Victoria and other states.
These include:
- Property price caps based on location
- Different limits for metropolitan and regional areas
- Applies to eligible established homes, new builds and house and land packages
- Buyers must purchase within the relevant cap to qualify
First Home Guarantee property price caps
The First Home Guarantee also uses Housing Australia property price caps to determine eligibility. Buyers must purchase or build within the maximum property value allowed for their chosen location to access the scheme benefits.
Includes the following:
- Regional and metropolitan property price limits
- Caps that vary between states and territories
- Applies to eligible first home purchases and new builds
- Buyers must meet all lender and scheme eligibility requirements
Because property price caps can change over time, buyers should confirm the latest limits through Housing Australia or a participating lender before applying. Understanding these requirements early can help buyers narrow their property search and avoid delays during the approval process.
How to apply for the Family Home Guarantee and First Home Guarantee
Applying for the Family Home Guarantee or First Home Guarantee involves working with a participating lender and meeting the eligibility requirements set by Housing Australia. While the application process may vary slightly between lenders, the overall steps are generally similar for both schemes.
Check your eligibility
Before applying, buyers should review the eligibility criteria for their chosen scheme. This may include checking income caps, buyer type requirements, property price caps and citizenship or residency eligibility. First home buyers should also confirm whether they meet the ownership requirements under the First Home Guarantee.
Speak with a participating lender
Both schemes are available through approved participating lenders. A lender or mortgage broker can explain available home loan options, assess borrowing capacity and help buyers understand which scheme may better suit their financial situation.
Prepare your financial documents
As part of the application process, buyers will generally need to provide documents relating to income, savings, expenses and identification. Lenders use this information to complete financial assessments and review loan approvals.
Choose an eligible property
Eligible buyers can begin searching for a suitable property once they understand their borrowing position and scheme eligibility. Depending on the scheme and lender requirements, this may include established homes, new builds or house and land packages that meet relevant property price caps.
Submit your application and finalise approvals
Once the lender confirms eligibility and reviews the required documents, the application can be submitted under the chosen government scheme. If approved, buyers can move forward with purchasing or building their new home.
Can you switch between the Family Home Guarantee and First Home Guarantee?
Some buyers may find that a different government scheme becomes more suitable as their financial situation or eligibility changes. While switching between the Family Home Guarantee and First Home Guarantee may be possible in some circumstances, buyers will generally need to reassess their eligibility and lender requirements before proceeding.
Confirm your eligibility for the new scheme
The Family Home Guarantee and First Home Guarantee have different buyer requirements, including rules relating to previous property ownership and dependent children.
Speak with a participating lender
Lenders can explain how switching schemes may affect home loan applications, approvals and borrowing capacity assessments.
Review property price caps and requirements
Buyers should confirm that the chosen property still aligns with the relevant government scheme and lender criteria before continuing the application process.
Prepare updated documents if needed
Financial documents and supporting information may need to be updated when applying under a different scheme or lender pathway.
Common mistakes when choosing between these two schemes
Choosing between the Family Home Guarantee and First Home Guarantee can feel confusing for buyers comparing eligibility requirements, deposit options and long-term home ownership goals. Understanding the key differences between the schemes may help buyers avoid delays, unsuccessful applications or financial pressure later in the process.
Assuming both schemes have the same eligibility rules
One of the most common eligibility mistakes buyers make is assuming the two schemes have identical requirements. The First Home Guarantee is generally designed for eligible first home buyers, while the Family Home Guarantee is specifically intended for eligible single parents or single legal guardians with dependent children.
Choosing a scheme before confirming borrowing capacity
Some buyers focus on the lower deposit requirement without fully understanding how borrowing capacity and lender assessments may affect approvals. Speaking with a participating lender early can help buyers compare home loan options and understand which scheme may better align with their financial situation.
Misunderstanding previous property ownership rules
The Family Home Guarantee may allow some buyers who have previously owned property to apply, while the First Home Guarantee is generally limited to buyers who have not owned residential property before. Misunderstanding these rules can lead to scheme confusion or unsuccessful applications.
Overlooking property price caps
Both government schemes include property price caps based on location and eligibility requirements. Buyers should confirm these limits before beginning their property search to avoid choosing a property that does not qualify under the scheme.
Focusing only on the deposit amount
Although lower deposit requirements can make home ownership more accessible, buyers should also consider ongoing repayments, additional purchase costs and long-term affordability when comparing schemes.
How Carlisle Homes can help you build with the right scheme
Finding the right pathway into home ownership starts with understanding which government scheme best suits your circumstances. Carlisle Homes supports buyers with a wide range of modern house and land packages and personalised home designs across Victoria, helping eligible buyers explore building options that align with Family Home Guarantee and First Home Guarantee requirements.
From first home buyers to eligible single parents planning a new chapter, our experienced team can help guide you towards a home solution that fits your lifestyle, budget, and long-term goals.
