How much could the government contribute under the Help to Buy Scheme?
The Australian Government Help to Buy Scheme is designed to support eligible first home buyers by contributing toward the purchase price of a home through a shared equity arrangement. Depending on the property type, the government contribution could reduce the amount buyers need to borrow and help make home ownership more achievable.
How shared equity percentages work under Help to Buy
In the Help to Buy Scheme, the amount the government contributes depends on whether the buyer is purchasing a new or existing home. Eligible buyers may receive up to 40% of the purchase price for a new home, or up to 30% for an existing home, through a shared equity arrangement.
This shared equity percentage represents the government’s ownership share in the property. Buyers still contribute a minimum deposit and take out a home loan with a participating lender for the remaining amount. Because the Australian Government contributes towards the purchase price, buyers may be able to reduce their borrowing amount and lower mortgage repayments.
As property values change over time, the value of the government’s equity share may also increase or decrease. Buyers can choose to buy back part or all of the government’s contribution over time, gradually increasing their ownership of the property.
What percentage of your home can the government contribute?
Under the Help to Buy Scheme, the Australian Government can contribute a capped percentage of the property value through a shared equity arrangement.
Government contribution caps:
- Up to 40% of the purchase price for eligible new homes
- Up to 30% of the purchase price for eligible existing homes
- Buyers must contribute a minimum deposit
- The remaining amount is funded through a home loan with a participating lender
How the equity cap works:
- The government’s contribution becomes an equity share in the property
- The percentage contributed affects the buyer’s loan size and mortgage repayments
- Buyers can buy back the government’s equity share over time
- The value of the government contribution may change as the property value changes
For eligible first home buyers, these equity caps may help reduce upfront costs and improve affordability when purchasing a home in Australia.
Example: Government contribution based on different property prices
The amount the government contributes under the Help to Buy Scheme depends on the property purchase price and whether the home is new or existing.
| Property price | New home contribution (up to 40%) | Existing home contribution (up to 30%) |
| $500,000 | $200,000 | $150,000 |
| $650,000 | $260,000 | $195,000 |
| $800,000 | $320,000 | $240,000 |
| $950,000 | $380,000 | $285,000 |
These examples show how the government contribution may increase as the property value rises, up to the scheme’s applicable equity caps and property price limits. Buyers must still contribute a minimum deposit and secure a home loan for the remaining amount.
How the government contribution reduces your deposit
The Help to Buy Scheme may help eligible buyers enter the property market with a smaller upfront deposit by reducing the amount they need to borrow.
How the deposit reduction works:
- Buyers contribute a minimum deposit, which may start from 2%
- The Australian Government contributes up to 40% for eligible new homes
- The government may contribute up to 30% for eligible existing homes
- Buyers borrow the remaining amount through a participating lender
What this may mean for buyers:
- Lower upfront deposit costs
- Reduced loan size
- Potentially lower mortgage repayments
- No Lenders Mortgage Insurance (LMI) required
- Improved affordability for eligible first home buyers
Because the government contributes towards the purchase price through a shared equity arrangement, buyers may be able to purchase a home sooner than through a standard home loan alone.
How the contribution affects your loan size and repayments
Under the Help to Buy Scheme, the government contribution reduces the amount buyers need to borrow from their lender. Because the Australian Government contributes a percentage of the purchase price through shared equity, the overall loan size may be smaller compared to a standard home loan.
A lower loan amount may also reduce initial mortgage repayments, thereby improving affordability for eligible first home buyers. This may help buyers manage upfront costs more comfortably while still entering the property market sooner.
However, because the arrangement uses shared equity, the government retains a percentage ownership stake in the property until that contribution is repaid. Buyers can choose to buy back the government’s equity share over time as their financial position changes.
What limits how much the government can contribute
The amount the government can contribute under the Help to Buy Scheme depends on several eligibility requirements and property thresholds.
Factors that may limit the government's contribution:
- Property price caps in the relevant state or territory
- Buyer income limits and taxable income thresholds
- Whether the property is a new or existing home
- Minimum deposit requirements
- Participation limits available each year
- Eligibility criteria set by Housing Australia
- Approval from a participating lender
- The percentage equity cap allowed under the scheme
Eligible buyers must also intend to live in the property as their principal place of residence and meet all Help to Buy eligibility requirements before applying for the scheme.
What happens to the government’s contribution over time
The government contribution is tied to the property’s value rather than remaining a fixed dollar amount. Because Help to Buy uses a shared equity model, the government retains a percentage ownership in the home until the contribution is repaid.
As property values change over time, the value of the government’s equity share may rise or fall. If the home increases in value, the government’s share becomes worth more. If the property value decreases, the value of that share may reduce as well.
Eligible buyers can gradually buy back part or all of their equity share, increasing their ownership percentage in the property. If the home is eventually sold, the government receives a proportion of the sale price based on its ownership share at that time.
How much you may need to repay the government later
The amount buyers may need to repay later depends on the property’s future value and the government’s equity share at the time of repayment or sale.
What affects the repayment amount:
- The percentage contribution originally provided by the government
- Changes in the property’s market value over time
- Whether the buyer chooses to repay part or all of the equity share
- The timing of the repayment or property sale
Example of how repayments may change:
- If the government contributed 30% toward a home worth $700,000, the initial equity share would equal $210,000
- If the property later increased in value to $900,000, repaying that same 30% share could amount to $270,000
- If the property value decreases, the repayment amount may also reduce
Because the arrangement uses shared ownership, the repayment amount is linked to the property’s current market value rather than the original contribution amount alone.
When the contribution may be lower than expected
Some buyers may receive a lower government contribution than expected due to scheme limits, eligibility requirements and property value caps.
1. Check the property price caps
The Help to Buy Scheme includes maximum property price limits that vary by state and territory. If the purchase price exceeds the cap, buyers may not qualify for the expected contribution amount.
2. Understand the equity contribution limits
Government contributions are capped at up to 40% for eligible new homes and up to 30% for eligible existing homes. Buyers must still contribute a minimum deposit and secure lender approval for the remaining amount.
3. Review income and eligibility requirements
Taxable income thresholds, ownership history and residency requirements can all affect eligibility. Buyers who do not meet the eligibility criteria may receive reduced support or may not qualify for the scheme.
4. Consider lender borrowing assessments
Even with shared equity support, lenders still assess borrowing capacity, financial commitments and repayment ability before approving a home loan.
Is the Help to Buy contribution worth it for your situation?
Whether the Help to Buy contribution is worth it depends on your financial goals, borrowing capacity and long-term ownership preferences.
Help to Buy may suit buyers who:
- Want to enter the property market with a smaller deposit
- Prefer lower initial mortgage repayments
- Need support improving borrowing capacity
- Are comfortable with a shared equity arrangement
- Want to buy a new home sooner
Help to Buy may not suit buyers who:
- Prefer full ownership of the property from the beginning
- Want complete control over future property equity
- Expect significant property value growth over time
- Are comfortable managing a larger home loan independently
- Prefer a standard home ownership structure
For many first home buyers, the decision comes down to balancing affordability today with long-term ownership goals.
How Carlisle Homes helps you plan your build with shared equity support
Carlisle Homes helps first home buyers explore new home builds and house and land packages that may align with Help to Buy eligibility requirements and contribution limits. Whether you’re building in Melbourne or regional Victoria, we can help you find a home design that aligns with your budget, lifestyle, and long-term home-ownership goals.
