Last Updated: 10th October, 2022

Regional First Home Buyer Guarantee Now Available From 1 October

Published by Otto Dargan on September 29, 2022

From 1 October 2022 to June 2025, 10,000 places will be available each year under the Regional First Home Buyer Guarantee. The scheme was scheduled to come into effect on 1 January 2023, but the government has shifted the date earlier.

This is huge news for Australians residing in regional areas.

Founder Otto Dargan and CEO Alan Hemmings praised the scheme and the accelerated timetable. Dargan added that there may well be room for further expansions of the Home Guarantee Scheme.

“The addition of places for regional buyers in the Home Guarantee Scheme is an excellent initiative from the government that will help first-home buyers get into the market,” Dargan said. “It’s hard to save while paying rent at the same time, so the main obstacle for first-home buyers is their deposit and the scheme addresses that. These schemes may need to be expanded in the future, as not everyone will get a place and this is the challenge we saw in previous years for schemes with limited places.”

Hemmings noted that the scheme would be particularly welcome now, given current market conditions.

“It is great the government has decided to pull the scheme forward and help first-home buyers at a time when affordability may be an issue,” Hemmings said.

What Is The Regional First Home Buyer Guarantee?

The Regional First Home Buyer Guarantee (RFHBG) is an expansion of the Home Guarantee Scheme. With a deposit as small as 5% of the property value, you can buy or build a property in a regional area without paying Lenders Mortgage Insurance (LMI).

LMI is usually applicable when you’re borrowing more than 80% of the property value. But under this scheme, you can borrow up to 95% of the property value and the government will guarantee 15% of the value of your loan.

Am I Eligible?

  • You must be an Australian citizen and at least 18 years old
  • You must not have owned a home before
  • You must buy outside of a capital city area
  • You must have been living in the region where the property is located, or the adjacent area, for 12 months
  • Your annual income must not exceed $125,000 for individuals or $200,000 for couples
  • The price of the property must not exceed the caps
  • You must buy the property as a principal place of residence and not an investment.

What Is A Regional Area?

The National Housing Finance and Investment Corporation (NHFIC) defines a regional area as “Statistical Area Level 4 (ASGS SA4 2016) areas in a State or the Northern Territory that are not a capital city of that State or Territory; and Norfolk Island; or the Territories of Jervis Bay, Christmas Island or Cocos (Keeling) Islands; as defined in the version published by The Australian Bureau of Statistics (ABS) in July 2016. The ACT and greater capital city areas of each State and the Northern Territory are excluded from the RFHBG. SA4s are based on population density and labour markets; they vary in size reflecting these criteria.”

What Are The Price Caps

State Regional Centre* All Other Regional Areas
New South Wales $900,000 $750,000
Victoria $800,000 $650,000
Queensland $700,000 $550,000
Western Australia $450,000
South Australia $450,000
Tasmania $450,000

*Regional centres are Newcastle and Lake Macquarie, Illawarra, Geelong, Gold Coast and Sunshine Coast.

Territory All Areas
NT Regional $600,000
Jervis Bay Territory & Norfolk Island $550,000
Christmas Island & Cocos (Keeling) Islands $400,000
ACT Not applicable

How To Apply For The Regional First Home Buyer Guarantee

You can either apply with a participating lender or reach out to a mortgage broker.

The participating lenders include major banks, non-banks and credit unions.

Are you ready to apply? Our mortgage brokers can help you with the application. Call us on 1300 889 743 or enquire for free online today.