The Australian Government 5% Deposit Scheme is Here – Your First Home Journey Starts Today

From 1 October 2025, first home buyers can step into home ownership with as little as a 5 per cent deposit through the newly launched Australian Government 5% Deposit Scheme – formerly known as the Home Guarantee Scheme.

The Scheme allows eligible buyers, including single parents or legal guardians with a deposit as low as 2%, to purchase a home without paying Lenders Mortgage Insurance (LMI). This helps buyers enter the market sooner, without the need to save a 20% deposit, potentially saving tens of thousands of dollars and shortening the journey to home ownership.

What has changed from 1 October 2025:

• Unlimited places available – every eligible first home buyer can now apply
• No income caps – higher-income earners are also eligible
• Higher property price caps – lifted across jurisdictions to reflect today’s market
• Continued support for single parents – purchase a home with just a 2% deposit

For example, a buyer in Bendigo can now purchase a $600,000 home with a $30,000 deposit and avoid paying about $25,000 in mortgage insurance. That is money that goes towards your own loan, not wasted on rent or fees.

The new property price caps

The updated property price limits are another big win, making more homes eligible under the scheme.

• In Victoria’s capital city and regional centres, the cap has moved from $800,000 to $950,000.
• In other parts of Victoria, the cap remains at $650,000.

This change opens the door to a much broader range of properties across metropolitan and regional areas.

Steps to take on your first home buyer journey

If you are considering taking advantage of the scheme, here are the key steps:

1. Check your eligibility using the  First Home Buyers Eligibility Tool
2. Review the new property price caps for your area so you know exactly what budget
3. Speak with a participating lender who will be able to submit your application to Housing Australia and guide you through pre-approval. You can also book a free consultation with Oakbury Financial Group, our trusted mortgage broker, for personalised guidance.
4. Find your place to call home with the confidence of knowing you can buy sooner. Explore Sherridon’s lower-cost House & Land packages, designed as perfect first home buyer options.

Madison - Silverwood Estate - Traralgon 

How Sherridon Homes can guide you

At Sherridon Homes, we are passionate about helping first home buyers take advantage of opportunities like this. With over 20 years of experience and more than 14,000 homes delivered, we understand the journey and how to make it simple and exciting.

We offer more than 90 flexible home designs, award-winning display homes and sales offices at 20 locations across Melbourne and regional Victoria, with expansion underway into southern New South Wales. Every home is backed by our Lifetime Structural Warranty*, giving you peace of mind long after you move in.

Our team is here to support you every step of the way, from understanding the scheme to handing you the keys to your very first home.

Ready to take the next step?

The Australian Government 5% Deposit Scheme is one of the most significant changes for first home buyers in years. With unlimited places, no income caps, higher price limits, and support for single parents, the opportunity has never been better. If you are ready to start exploring your options, we would love to help. Contact our team today and let’s turn your dream of home ownership into reality.

For more information about the Scheme, including eligibility and how to apply, visit firsthomebuyers.gov.au