Borrowing Power Explained: How Much Can You Afford
First Home Buyer Guarantee Sydney: What the Expansion Means for You
Good news – if you’ve been waiting to take the leap onto the property ladder in Sydney as a First Home Buyer, the path just got a lot clearer. Here’s what’s changing, why it matters, and how you can make the most of it.
Expanded First Home Buyer Guarantee Hits Sydney Early
The Federal Government has brought forward its expanded First Home Buyer Guarantee nationwide, launching on 1 October 2025 — three months ahead of schedule. This means:
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5% deposit schemes open to all first-home buyers — no more waiting to save 20%.
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Income caps removed, making the scheme accessible to more people.
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Increased price thresholds:
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Sydney — up to $1.5 million
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Melbourne — up to $950k
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Brisbane — up to $1 million
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Experts estimate as many as 70,000 buyers will enter the market in the first year — that’s 20,000 more than before.
Why It Matters for You in Sydney
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Slash the time it takes to save: Many buyers spend over a decade saving for a 20% deposit—now, a 5% deposit could move you in years sooner.
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Avoid costly LMI (Lenders Mortgage Insurance), which can be up to $30,000 or more. The government guarantee takes the place of LMI.
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Secure better finance sooner: Getting into the market early can help you lock in a property before prices escalate further.
That said, it’s not risk-free. A higher loan-to-value ratio means less upfront equity. Some experts caution this could limit refinancing flexibility and increase long-term costs.
What First Home Buyers in Sydney Need to Know
| Feature | Details |
|---|---|
| Availability | Starts 1 October 2025, earlier than planned |
| Deposit Amount | 5% of property value; no LMI required |
| Price Limit (Sydney) | Up to $1.5 million |
| Eligibility | First-home buyers, no income cap |
| Impact | Fast track access with potentially less out-of-pocket costs |
Maximise Your Chances of Success
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Lock in finance early — The scheme will be highly popular.
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Know the price cap for your suburb — $1.5 million may not stretch far in some areas.
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Understand your long-term plan — Higher debt means higher repayments; make sure the home still fits your goals.
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Pair the scheme with state grants — In NSW, consider stamp duty exemptions or First Home Owner Grants to save even more.
Final Word
If you’re thinking about buying your first home in Sydney, the expanded First Home Buyer Guarantee could be a game changer.
Getting in fast may be better than saving longer—especially as the market keeps moving.
Ready to see if this scheme is right for your path? We’re here to help with clarity and strategy every step of the way.
Want help layering in NSW-specific grants or building a game plan for your suburb? Get in touch today.
Hero Finance serves First Home Buyers across Sydney and Australia, located in Ryde.