Help to Buy is the Australian Government’s shared equity scheme: the government contributes part of the purchase price alongside you, holds an equity share in the home, and you buy the rest with a small deposit and a smaller loan. It suits a specific kind of buyer extremely well, and it is worth understanding before deciding which pathway fits you.

How does shared equity work?

Under the scheme, the government contributes up to 40% of the price for a new home, or up to 30% for an established home, taken as an equity share, not a loan. You need a deposit of as little as 2%, and you borrow only the remainder. There are no repayments on the government’s share and no interest on it: instead, when you eventually sell, the government receives its percentage share of the sale price, sharing in any growth, and you can also buy back its share progressively over time as your finances allow.

What are the Help to Buy caps in NSW?

Help to Buy carries income caps, $103,000 for a single buyer and $165,000 for joint applicants, and a property price cap of $1.3 million for Sydney. This is the key structural difference from the 5% deposit scheme, which since October 2025 has no income caps at all. Help to Buy targets buyers whose incomes make a full Sydney-sized mortgage genuinely unaffordable, and for that group it does something no other scheme does: it shrinks the mortgage itself.

What does it mean for repayments?

Because you borrow perhaps 60–70% of the price rather than 95%, repayments are dramatically lower than any low-deposit alternative on the same home. That is the scheme’s core gift: a repayment that fits a moderate income in a market priced beyond it. The corresponding trade is on the way out, the government shares the upside when you sell, in proportion to the equity it held.

What should you weigh up?

  • Your home has a co-owner of sorts. Significant renovations and the eventual sale involve scheme rules, not just your preferences.
  • Growth is shared. If the property rises strongly, the government’s share rises with it. Buying back its share earlier captures more growth for you, and the buyback happens at market value, so it costs more as the home appreciates.
  • Income caps are ongoing policy, not just an entry test, sustained income above the caps can trigger requirements to begin buying out the government’s share. If your income is likely to grow quickly, weigh whether the 5% scheme suits your trajectory better.
  • Places and availability. Help to Buy operates with allocated places and participating lenders; availability at the moment you apply is part of the answer.

Help to Buy or the 5% scheme?

A rough compass: if your income comfortably services the loan and the barrier is only the deposit, the 5% scheme keeps every dollar of future growth yours. If servicing a full loan is the barrier, income solid but simply not Sydney-sized, Help to Buy’s smaller mortgage is the feature nothing else replicates. Many buyers qualify for both, and the right answer falls out of the repayment arithmetic, run yours in the repayments calculator both ways and the difference is immediately visible.

Who does Help to Buy suit?

Help to Buy works best for a specific profile: a household with a steady, moderate income that can comfortably service a loan for part of a Sydney-priced home but not all of it, a small deposit, and an intention to hold the property for a long time. Single-income households, people in stable but modestly paid professions, and buyers who have been renting for years without the deposit ever catching up with prices are the people the scheme was designed around. It suits less well anyone whose income is likely to rise quickly past the caps, anyone planning to sell within a few years, and anyone who would rather carry a larger loan than share future growth.

How do the numbers work on a shared equity purchase?

An illustration at an established-home price of $800,000, with the government taking the maximum 30% share: the government contributes $240,000, you contribute a 2% deposit of $16,000, and your loan is $544,000. Compare that with a 5% scheme purchase of the same home, where the deposit is $40,000 and the loan $760,000. The Help to Buy loan is more than $200,000 smaller, and the monthly repayment falls accordingly. Run both loans through the repayments calculator and the gap is the scheme’s entire proposition. The trade is visible on the other side of the ledger: if the home is eventually sold for $1,000,000, the government’s 30% share is worth $300,000 at that point, not the $240,000 it contributed.

How do you buy back the government’s share?

You are not locked into the shared ownership permanently. The scheme allows you to buy back the government’s equity over time in minimum increments, at the property’s market value at the time of each buyback, which means each purchase of equity is priced at whatever the home is then worth. The practical strategy most people settle on is to buy back when a pay rise, a bonus or an inheritance makes it possible, and to do so earlier rather than later if the market is rising, because waiting makes each percentage point more expensive.

Can you sell, rent or renovate?

The government is a co-owner in economic terms, so decisions that affect the property’s value involve the scheme’s rules. Selling triggers the division of proceeds according to the equity shares at that time. Renting the property out is generally not permitted while the government holds a share, because the scheme is for owner-occupiers. Significant renovations may need approval, and the way they are treated on sale, since they add value you paid for, is set out in the scheme conditions and worth reading before you plan a new kitchen.

How do you apply for Help to Buy?

Help to Buy applications run through participating lenders, with Housing Australia assessing eligibility against the scheme criteria and the lender assessing the loan against its own policy. Expect to evidence your income against the caps, your first home status, your deposit and your intention to live in the property. Because places are allocated, timing matters: confirm availability before you commit to a search built around the scheme, and ask your lender how long an allocated place is held. The property must fall within the price cap for its location and be of a type the scheme accepts, and new builds and established homes attract different maximum government shares, which changes the arithmetic between two otherwise similar purchases.

Questions people ask

Can I use Help to Buy and the 5% deposit scheme together?

No. They are alternative pathways for the same purchase, not complementary ones. You choose the structure that suits your income and your view of future growth. NSW stamp duty relief, which is a state measure, can apply alongside either.

What happens if my income rises above the cap?

The caps are an ongoing condition. Sustained income above them can trigger a requirement to begin buying back the government’s share, on a timetable set by the scheme rules. If your career trajectory makes that likely, weigh it against the 5% scheme before you choose.

Is there a limit on how many people can use it?

Yes. Help to Buy operates with allocated places each year and through participating lenders, so availability at the time you apply is part of the answer. Eligibility is assessed by Housing Australia and the lender.

Do I still need lenders mortgage insurance with a 2% deposit?

Generally not, because the government’s equity share means your loan is a much smaller proportion of the property’s value, typically well under the 80% line that triggers LMI. Confirm with the participating lender, as the loan-to-value ratio depends on the share the government takes and the price of the specific property, but the small deposit does not carry the LMI cost it would in an ordinary purchase.

Eligibility for either scheme is assessed by Housing Australia and the lender, and settings change over time, figures here are as at October 2026. A free assessment checks your income, deposit and target price against both schemes’ current rules and tells you which doors are actually open.

Sources: firsthomebuyers.gov.au, Help to Buy eligibility and income limits ($103,000 individual, $165,000 joint or single parent) and price caps, checked 17 October 2026.

General information only, not credit, legal or tax advice. Your situation is assessed properly before any recommendation. Government scheme details change; figures are current at the time of writing.