Australia’s first home buyer scheme has just had its biggest shake-up yet and it could make stepping into the Brisbane market far more achievable.
From 1 October 2025, the First Home Guarantee (also known as the 5% Deposit Scheme) will offer unlimited places, no income caps, and higher property price limits.
For Queenslanders, that means more opportunity to buy sooner, and potentially with less savings than ever before.
If you’re thinking about buying in 2025 or 2026, this is your chance to plan ahead and get ahead.
Join LOYLE’s Property List to be the first to hear about eligible homes and exclusive off-market opportunities before they hit the market.
What Is the First Home Buyer Scheme?
The First Home Guarantee Scheme (FHGS) is a federal government initiative that helps eligible Australians buy their first home with a deposit as low as 5%, without paying Lenders Mortgage Insurance (LMI).
Normally, a buyer with less than a 20% deposit would need to pay LMI, which can add tens of thousands to upfront costs. Under this scheme, the government guarantees the remaining 15%, letting buyers skip LMI altogether.
That means first home buyers can enter the market earlier without needing to save the usual 20% deposit.
Who Is Eligible?
Any Australian citizen aged 18 or over who is buying their first home to live in can apply for the First Home Guarantee Scheme. You’ll need at least a 5% deposit and must intend to make the property your main residence.
Previously, the scheme was restricted to singles earning under $125,000 a year and couples with a combined income below $200,000. Now, those limits have been completely removed. There’s no income cap and no restriction on the number of people who can access the scheme, giving more Australians the chance to enter the market sooner.
There was also a limit on how many people could access the scheme each year, meaning many missed out even if they qualified. From 1 October 2025, those limits are gone too.
To qualify, buyers will still need to purchase a home within the property price caps set for their area.
What’s Changed in Queensland?
The expanded First Home Buyer Deposit Scheme comes with a major lift in property price caps:
| Location | Previous Property Price Cap | Property Price Cap effective 1 October 2025 |
QLD – capital city and regional centre | $700,00 | $1,000,000 |
QLD – other | $550,000 | $700,000 |
This increase reflects Brisbane’s rapid property growth and opens the door to quality homes in suburbs that were previously out of reach for many first home buyers.
To put this into perspective, under the new cap, a Brisbane buyer purchasing a $900,000 townhouse would need just $45,000 as a 5% deposit.
Assuming a 30-year loan at 6%, repayments would start around $5,400 per month and the buyer would save roughly $30,000–$35,000 in Lenders Mortgage Insurance.
This shift could help many Queenslanders secure properties sooner, without compromising on location or quality. According to the ABC, the changes are expected to almost double the number of affordable homes available to first home buyers.
Why the Government Expanded the Scheme
The expansion comes as housing affordability remains a key challenge. Home prices have continued to rise, outpacing wage growth, leaving many first home buyers struggling to keep up.
By removing income caps and lifting price limits, the government aims to help middle- and high-income earners who’ve been priced out of the market, while also stimulating new housing supply across Australia.
However, more buyers entering the market could increase competition potentially pushing prices higher in certain areas.
What It Means for Buyers and Investors
For first home buyers, this is a major opportunity to secure a home sooner and avoid paying tens of thousands in LMI fees.
For sellers and investors, the ripple effect of new buyer demand could tighten supply in popular suburbs, potentially lifting both property values and rental yields. Sellers may find the expanded scheme brings increased demand from first home buyers, particularly in areas within the new Queensland property caps.
Homes that appeal to this group, such as well-located townhouses or family-friendly houses near schools and transport, could see more enquiries and stronger competition. By understanding these trends, LOYLE can help sellers position their property strategically to attract motivated buyers and make the most of current market conditions.
At LOYLE, we’ve guided countless buyers and investors through changing market conditions from lending shifts to policy reforms like this one. Our insight into Brisbane’s property trends helps clients move early, buy smart and sell strategically.
How to Take Advantage Early
The First Home Buyer Deposit Scheme is now in effect, giving eligible buyers the opportunity to enter the market with just a 5% deposit.
It’s still a smart time to plan. Review your finances, speak to a broker about pre-approval, and start tracking houses that fall within the new Queensland price caps. Staying informed about eligible properties and off-market deals will give you a head start in a competitive market.
Join LOYLE’s Property List today to be the first to know when new homes and off-market listings become available.
Frequently Asked Questions
When did the new scheme changes start?
The expanded scheme officially began on 1 October 2025.
Can I use the 5% Deposit Scheme to buy an investment property?
No. It’s only available to first home buyers purchasing a property to live in.
Do I still pay stamp duty?
Yes. The scheme helps with your deposit and LMI costs, but state-based taxes like stamp duty still apply.
