Introduction
From 1 October 2025, the federal Home Guarantee Scheme will expand materially. The headline is simple—5% deposits for all first‑home buyers (no LMI)—but the flow‑through into our local market will vary by price point and property type. Read our Northern Beaches buyers agent first home buyer scheme review to see what’s changing and what we expect to see on the Beaches.
What is changing—fact check
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Earlier start: Brought forward to 1 October 2025.
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Unlimited places: The scheme is uncapped, removing the annual quota bottleneck.
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Income caps removed: Access no longer restricted by income thresholds.
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Higher property price caps: For newly‑constructed property, caps rise meaningfully (e.g., Sydney proposed at $1.5m), while existing‑property caps in Sydney remain at $900k in the official proposal documents.
Important nuance: The government’s communications confirm “unlimited places, no income caps and higher price caps” from 1 October. Official impact analysis and costings set out the cap structure (new vs existing) and the Sydney $1.5m figure for new builds; lenders will operationalise these settings once Housing Australia’s directions are embedded across participating banks.
What that likely means here
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Unit and townhouse segments under ~$900k will see more depth.
That includes pockets of Manly Vale, Brookvale, Dee Why and Narrabeen where established apartments transact under the existing Sydney cap for existing dwellings.
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New‑build stock near centres could attract FHBs who previously couldn’t stretch.
With higher caps for newly‑constructed dwellings, select off‑the‑plan and recently‑completed projects around Brookvale/Warringah Mall, Manly Vale and Frenchs Forest will screen in for more buyers. Quality and builder credentials will matter more than ever.
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Near‑term price pressure risk at the entry point.
Independent analysis cautions that expanded eligibility can lift prices in targeted bands when supply is tight. The effect tends to be localised (by budget and property type) rather than market‑wide.
How first‑home buyers can use it (without over‑stretching)
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Get two lending scenarios: one inside the scheme and one outside (so you know if you’re paying a price premium to “use” the scheme).
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Stress‑test repayments at +3% on today’s rate (that aligns with how banks assess you) and keep a rainy‑day buffer after settlement.
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Prioritise building integrity: strata health, waterproofing history, lift/roof CAPEX, and sinking‑fund adequacy beat a new kitchen.
How vendors/agents can prepare
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Calibrate marketing to the right price bands: If your apartment sits in the $800–950k range, expect more FHB enquiries; speak directly to that buyer in copy and disclosure packs.
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Expect faster “time to finance” from scheme buyers (once lenders update processes) but build in daylight for valuation and scheme approvals.
What could go wrong?
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Thin construction pipelines: Higher caps don’t manufacture trades or materials; build costs and capacity remain constraints.
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Price bracket cliffs: If competition bunches at $900k for existing stock, buyers may chase new builds at higher caps—quality screening becomes critical.
The local wrap
This change broadens the buyer base for accessible apartments and select new builds near our centres. It does not turbocharge premium house markets. If you’re targeting the entry segment on the Beaches, this is a material shift—use it, but don’t let it use you.
