What a Pledge to Scrap Help to Buy Means for First Home Buyers Right Now

A policy promise, not a change to the law

This week brought news worth knowing about if you are saving for a first home or already using a government scheme to get there. On Monday the federal Coalition said that if it wins the next election it would abolish Help to Buy, the shared equity scheme that helps eligible buyers get into a home with as little as a 2 percent deposit. The announcement, reported by The Adviser and the ABC, is part of a package of proposed savings worth $4.7 billion across several housing programs, sitting within a wider $31.3 billion set of budget cuts the Coalition says would help pay for its income tax policy.

Along with Help to Buy, the Coalition flagged ending the Housing Australia Future Fund (the government's social housing fund), the New Homes Bonus payments to states that hit housing supply targets, and tax incentives for build to rent developers. Shadow Treasurer Tim Wilson linked the savings to cost of living pressure, while Treasurer Jim Chalmers rejected the idea that government spending is behind recent inflation.

Before anyone changes their plans, it is worth being clear about what this actually is. It is an opposition pledge, not a change to government policy. Nothing happens to Help to Buy unless the Coalition wins the next election, which is not due until May 2028, and reporting on the announcement points to the broader savings package starting in the 2028 to 2029 financial year at the earliest. Neither The Adviser nor the ABC mentioned any detail on what would happen to people already in the scheme, with an application in progress, or waiting on a settlement. For now, Help to Buy keeps running exactly as it has since it opened on 5 December last year.

What Help to Buy actually does

If you have not looked closely at this scheme, here is the plain English version. Help to Buy is a shared equity program where the government becomes a part owner of your home alongside you, so you need less of your own money to get in the door. The government can contribute up to 40 percent of the purchase price for a new build or 30 percent for an existing home, and eligible buyers can put down a deposit of just 2 percent instead of the usual 20. To qualify, your income needs to sit under $103,000 if you are buying alone or $165,000 combined for a couple, and there are only 10,000 places available each year. In its first seven months to the end of June, the scheme recorded 7,261 active applications, 4,808 approvals and 3,636 settlements, so demand has been running well ahead of the yearly cap.

What this means if you are planning around it

Government schemes like this one always carry a degree of political risk, and this week is a reminder of that rather than a reason to panic. If getting into the market sooner rather than later depends on a scheme like Help to Buy, the sensible approach is to treat the current rules as what you can actually rely on today, and to use the window while it exists rather than assume it will still be there in three or four years. It is also worth remembering that a scheme deposit does not change how a lender assesses whether you can afford the loan itself. Banks still test your ability to repay using a buffer of 3 percentage points above the actual interest rate, on top of your real expenses and any other debts, whichever scheme you use.

If you are weighing up Help to Buy, the Home Guarantee Scheme or simply saving a full deposit, it is worth talking it through with a broker who can map out what each path means for your borrowing power and your timeline, rather than relying on headlines either way.

Figures on the proposed housing savings, the $31.3 billion budget package and the Help to Buy application numbers are drawn from The Adviser and ABC News reporting published 26 October 2026. Help to Buy eligibility criteria, deposit and co ownership thresholds are from Housing Australia. The APRA serviceability buffer figure reflects APRA's most recently confirmed position.

This article is general information only and does not take into account your personal objectives, financial situation or needs. Please speak with a Claremont Financial broker before making any borrowing decision.