More Lenders Join Help to Buy: Could You Buy Your First Home With a 2% Deposit?

Saving a deposit is one of the biggest hurdles for first home buyers. With rents high and prices still climbing in many areas, it can feel like the goalposts keep moving.

That’s where the federal government’s Help to Buy scheme comes in. It lets eligible buyers get into the market with as little as a 2% deposit. And the good news is that more lenders have now joined, giving buyers more choice.

In this article, I’ll explain how Help to Buy works, who can use it, what’s changed recently, and the trade-offs you need to understand before deciding if it’s right for you.

What is Help to Buy?

Help to Buy is a shared equity scheme run by Housing Australia for the federal government. It opened for applications on 5 December 2025.

Shared equity means the government buys part of your home alongside you. Because the government owns a share, you need a smaller deposit and a smaller home loan.

Here’s how it works:

• You need a deposit of at least 2% of the purchase price.
• The government contributes up to 30% of the price for an existing home, or up to 40% for a newly built home.
• You borrow the rest from a participating lender.
• The government owns that share of your home. If the property goes up in value, so does their share. If it goes down, their share goes down too.
• You don’t pay rent or interest on the government’s share.
• You can buy back the government’s share over time, in stages, or pay it back when you sell.

What’s changed recently?

When Help to Buy launched, only two lenders took part: Commonwealth Bank and Bank Australia. That limited choice, especially for people who wanted to apply through a broker.

The lender panel has grown in 2026:

• In July, the Teachers Mutual group joined, including Teachers Mutual Bank, Health Professionals Bank, Firefighters Mutual Bank and UniBank.
• On 6 October, Queensland Country Bank joined as well.

That means seven lender brands now offer Help to Buy loans. Each lender sets its own rules on whether you can apply directly or through a broker, so it’s worth checking which pathway suits you.

The scheme has grown in other ways too. Housing Australia confirmed 10,000 new places for the 2026 to 2027 financial year. Income limits were also raised, and the scheme is now available in every state and territory after reaching Tasmania in June 2026.

Who is eligible?

The scheme has strict eligibility rules. Generally, you need to:

• Be an Australian citizen, aged 18 or over.
• Earn under the income limit. For 2026 to 2027, that’s a taxable income of $103,000 for single applicants, or $165,000 for joint applicants and single parents.
• Not own, or have an interest in, any other property.
• Live in the home as your main residence.
• Buy a property under the price cap for your area. Price caps vary by state and region.
• Have a deposit of at least 2%, plus enough to cover your buying costs.

You’ll also need to meet the lender’s normal lending criteria, including showing you can afford the repayments. You can check the current price caps and full rules on the Housing Australia website.

A real-world example

Let’s look at how Help to Buy compares with a standard low deposit purchase. Say you’re buying an existing home for $750,000.

	Help to Buy	5% Deposit Scheme
Your deposit	$15,000 (2%)	$37,500 (5%)
Government share	$225,000 (30%)	None
Your home loan	$510,000	$712,500
Monthly repayment at 6.5% over 30 years (approx.)	$3,220	$4,500

With Help to Buy, the home loan is about $200,000 smaller. That cuts the monthly repayment by roughly $1,280. For many buyers, that’s the difference between being able to buy now or waiting years.

These figures are a simple guide only. They don’t include stamp duty, legal costs or other buying costs, which you’ll still need to cover. You can estimate your stamp duty with my stamp duty calculator.

The trade-offs to understand

Help to Buy can be a great option. But it’s important to go in with your eyes open. Here are the key things to weigh up:

• You share the growth. If your home goes up in value, the government’s share grows too. When you buy it back or sell, you pay back their share at the property’s value at that time.
• You pay all the costs. Even though you only own part of the home, you’re responsible for all council rates, strata, insurance and maintenance.
• There are rules about changes. You may need approval for things like major renovations or renting out the home.
• Income checks continue. Your income is reviewed each year. If it rises above a set level for a sustained period, you may need to start buying back the government’s share.
• Fewer lenders. While the panel is growing, you still have fewer loans to choose from than with a standard loan.

None of these are deal breakers. But they mean Help to Buy suits some buyers better than others.

Other options worth comparing

Help to Buy isn’t the only government scheme for first home buyers. Depending on your situation, these might suit you better:

• The 5% Deposit Scheme. Eligible first home buyers can buy with a 5% deposit and avoid lenders mortgage insurance (LMI). Since October 2025, there are no income limits or caps on the number of places, though property price caps still apply. You own 100% of your home.
• The Family Home Guarantee. Eligible single parents and legal guardians can buy with as little as a 2% deposit and no LMI, again owning the whole home.
• State concessions. Many states offer stamp duty savings or exemptions for first home buyers.

The best choice depends on your income, savings, the type of property you want, and your long-term plans. You can learn more on my first home buyer loans page, or if you’re a single parent, on my single parent home loans page.

How to get started

If you think Help to Buy might suit you, here are some simple first steps:

1. Check you meet the basic eligibility rules, including the income limit and price cap for your area.
2. Work out how much you could borrow with my borrowing power calculator.
3. Get your documents ready, such as payslips, bank statements and ID.
4. Talk to a broker about which lender and scheme fits your situation best.

How I can help

At Awesome Lending Solutions, I help first home buyers compare every option, not just one. I’ll explain how Help to Buy, the 5% Deposit Scheme and the Family Home Guarantee would each work for you, and show you the real numbers side by side.

Help to Buy could make owning a home possible sooner than you expected. Let’s work out if it’s right for you. Call me on 02 7904 9560 or book a free appointment to check your options.