The First Home Guarantee Rules in Perth Changed Last Year. Most Buyers Still Don’t Know.

4 min read

,

Reviewed Content

Written and reviewed by Callum Duffy, Finance Broker and MFAA member at Galway Finance. This article is general information only and does not replace personal credit assistance, legal, tax or financial advice. Check official sources for current government scheme, duty, grant and lender-policy details before relying on any figure.

Rules current as of July 2026, checked against Australian Government 5% Deposit Scheme information and the published Perth price cap.

If you looked into the First Home Guarantee before October 2025 and walked away thinking you did not qualify because your income was too high, or because nothing worth buying in Perth fell under the old price cap, it is worth looking again. Both of those barriers have changed.

Here is what actually changed, who it affects, and how to find out where you stand.

What changed on 1 October 2025

Three things, all in your favour:

  1. No income cap. The old limits, $125,000 for individuals and $200,000 for couples, have been removed entirely. There is no maximum income to qualify for the guarantee itself.
  2. No cap on places. The scheme used to run out of spots partway through the financial year, which meant timing mattered as much as eligibility. That cap is gone. If you are eligible, there is a place for you.
  3. Perth’s property price cap rose to $850,000, up from $600,000. That is a significant chunk of the Perth metro market that simply was not accessible under the scheme before, now back in play.

How the scheme actually works

  1. You provide a 5% deposit.
  2. The government guarantees up to 15% of the property’s value to your lender.
  3. Your lender treats the loan as though you had a 20% deposit, which means no Lenders Mortgage Insurance (LMI), a cost that can otherwise run into the tens of thousands.
  4. It is a guarantee to the lender, not a cash payment to you. You still borrow the full amount and remain fully responsible for repayments.
  5. You apply through a participating lender or a mortgage broker, not directly through Housing Australia.
  6. Standard lending checks still apply: borrowing capacity, credit history, employment, and property valuation.

Who this actually changes things for

The couple who got knocked back on income in 2023. If you and your partner had a combined income over $200,000 and were told you did not qualify, that restriction no longer exists. Worth checking again.

The buyer who wrote off inner and middle ring Perth. Under the old $600,000 cap, a lot of established homes in well located suburbs were simply out of reach for the scheme. At $850,000, a much wider range of Perth properties now qualifies.

Anyone sitting on a 5% deposit who assumed LMI was unavoidable. If you have been saving toward a full 20% deposit specifically to avoid LMI, it is worth finding out whether the scheme gets you there sooner, with a smaller deposit and no LMI cost.

Why go through a broker rather than a single lender

Not every bank participates in the scheme, and the ones that do do not all assess applications the same way. A few reasons it is worth going through a broker rather than walking into one branch:

  1. Not all lenders are on the panel. Housing Australia publishes a list of participating lenders. If your regular bank is not on it, applying there directly wastes your time. A broker knows the current panel and will not send you down a dead end.
  2. Policy varies lender to lender. Two lenders can both offer the scheme and still assess your income, employment type, or deposit source differently. A broker compares your situation against multiple lenders’ actual policies, not just one bank’s rulebook.
  3. You only get one shot at a place, effectively. Even though the annual cap on places is gone, your guarantee reservation still ties to a specific contract and timeframe. Getting matched to the right lender the first time avoids delays that can put a signed contract at risk.
  4. Fees and commissions should be disclosed clearly. If a lender recommendation is made, the broker’s remuneration and any fees that apply should be explained before you proceed, so you can make the decision with the full cost picture in front of you.

Find out where you stand

Eligibility rules are one thing. Whether you personally qualify, and with which lender, depends on your income, deposit, and the specific property. That is a short conversation, not another afternoon of reading government fact sheets.

Book an initial eligibility check

I will tell you clearly whether you are likely to qualify under the current rules, and if you are not, exactly why. No obligation.