Everything you need to know about the First Home Loan Deposit Scheme New Home Guarantee

13 October 2020

Marie Ryan, Director and Accredited Finance Broker, Finance Solutions |

The First Home Loan Deposit Scheme (FHLDS) helps first home buyers purchase a home sooner. The Federal Government provides a guarantee to participating lenders, allowing eligible first home buyers to purchase a home with a deposit of as little as 5% without needing to pay for lenders mortgage insurance (LMI).

Lenders mortgage insurance is a cost of borrowing for a home loan when the deposit is less than 20%. The cost varies, but as an indication, based on a $650,000 purchase with a 5% deposit, the LMI cost would be approximately $27,000, so the scheme provides a significant saving.

Changes from the previous scheme

An additional 10,000 places have been announced as part of the 2020-21 Federal Budget, and there are some major differences to be aware of.

It is now called the First Home Loan Deposit Scheme New Home Guarantee

It applies only to purchases of newly built homes, off-the-plan purchases, and new home constructions. Established properties are no longer eligible.

The property purchase price caps have increased, opening the scheme up to more buyers. For example, Brisbane, Sunshine Coast and Gold Coast maximum purchase prices have increased from $475,000 to $650,000 (and the rest of the State from $400,000 to $500,000).

What has stayed the same

All other eligibility criteria remain unchanged. Applicants must:

  • Be Australian citizens
  • Be at least 18 years of age
  • Be first home buyers who have not previously owned, or had an interest in, a property in Australia, either separately or jointly with someone else
  • Have between 5% and 20% of the value of an eligible property for the loan deposit
  • Have a taxable income of up to $125,000 pa for the previous financial year (if applying as a single applicant) or $200,000 pa (if applying as a couple)
  • Intend to be owner-occupiers of the property.

How to apply

The scheme is administered by the National Housing Finance and Investment Corporation (NHFIC) through a select panel of participating lenders. The opening date for applications is yet to be announced. 

It is certainly a great time for homebuyers to buy in Queensland. The FHLDS New Home Guarantee, together with the $15,000 First Home Owner Grant (FHOG) and $25,000 HomeBuilder Grant, will provide a great incentive for Queenslanders to buy a newly built home, supporting the growth of the State’s construction industry, while helping people into their first home sooner.

If you have any questions, please contact Marie Ryan. BDO can calculate your unique borrowing capacity and assist with applying for finance and the FHLDS New Home Guarantee, along with assistance with other grants you may be eligible for.

The following table provides a comparison of the FHLDS New Home Guarantee, First Home Owner Grant and Homebuilder Grant.

Queensland home owner concessions

If you are having trouble viewing the table below please click here to view the pdf.


First Home Owner Grant ($15,000)

First Home Loan Deposit Scheme (FHLDS) New Home Guarantee

Homebuilder Grant ($25,000)

Who it is for

First home buyer

who will live in the home

First home buyer with less than 20% deposit and who will live in the home

Home buyer who will live in the home or home renovator


A grant of $15,000

Waived Lenders Mortgage Insurance

A grant of $25,000

Loan purpose

To buy or build a new home1 (not previously occupied or sold as a place of residence) or an off-the-plan home

To buy or build a new home (not previously occupied or sold as a place of residence) or an off-the-plan home

To buy or build a new home (not previously occupied or sold as a place of residence) or an off-the-plan home, or substantially renovate3 an existing home

Maximum purchase

Less than $750,000

$650,000 for Brisbane, Sunshine/ Gold Coast, $500,000 for rest of Queensland


Applicant eligibility

  • Individual
  • 18 years or older
  • Australian citizen or permanent resident (or applying with someone who is)
  • First home buyer/s2
  • No income test


  • Individual
  • If joint: married or de facto
  • 18 years or older
  • Australian citizen/s (all)
  • First home buyer/s (all)
  • Max taxable income based on last financial year tax return - $125,000 pa for an individual or $200,000 pa for a couple
  • Individual
  • If joint: married or de facto
  • 18 years or older
  • Australian citizen/s (all)
  • Max taxable income based on last financial year tax return - $125,000 pa for an individual or $200,000 pa for a couple

Extra information and exceptions

  • Paid per new home, not to each applicant for the same home
  • You must move into the home as your principal place of residence within one year and live there continuously for six months


1May be an established home that has been substantially renovated before your purchase or a home moved from one site to another if the home has not been occupied since being moved

2If owned interest in property since 1 July 2000 solely used for investment purposes, you may be eligible

  • Genuine savings of 5% minimum
  • Principal and interest loans only (Interest only allowed during construction period)
  • Available only through participating lenders
  • 10,000 extra places were announced 3 October 2020. Details of availability to come
  • 3Renovate an existing owner-occupied home at cost of $150,000 to $750,000, where property value is less than $1,500,000 prior to renovation


Not for:

  • Renovations adding to property (e.g. pool, tennis court, outdoor spa/sauna, sheds, garage)
  • Non-arm's length building or purchase contract (i.e. related party/special price)

Important dates

Ongoing scheme applying to contracts dated 1 July 2018 or later

Limited availability – usually 10,000 places released each financial year

Further 10,000 places announced 3 October 2020

Contracts 4 June 2020 to 31 December 2020.
Construction must commence within three months and must not have started before 4 June 2020

How to apply4

Through bank or lender or Office of State Revenue

Through participating lenders

Apply online

Fact sheets

Eligibility check

Eligibility check

Fact sheet


If you are in regional Queensland, you may also be eligible for the $5,000 Regional Home Building Boost Grant


stamp duty concessions

Calculated on the purchase price of the property


Calculate your stamp duty here

Owner-occupier home buyers (not first home) receive concessions of up to $7,175 (regardless of purchase price).

First owner-occupier home buyers pay no stamp duty if the purchase price is up to $500,000.

Discounted stamp duty applies for a purchase price of $501,000 to $549,999. No further discounts apply from $550,000.

Purchase price


Investment or

vacant land

First home

Not first home

























Find out more

Contact Marie Ryan in BDO's Finance Solutions team.

Marie will help you identify the assistance you are eligible for and support you with the application process.


Marie Ryan is an authorised credit representative 519653 of BDO Corporate Finance Ltd (ACN 010 185 725) Australian Credit Licence 24551.

Your full financial needs and requirements need to be assessed prior to any offer or acceptance of a loan product.

BDO Corporate Finance Ltd ABN 54 010 185 725 Australian Credit Licence No. 245513 is a member of a national association of independent entities which are all members of BDO Australia Ltd ABN 77 050 110 275, an Australian company limited by guarantee. BDO Corporate Finance Ltd and BDO Australia Ltd are members of BDO International Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent member firms. Liability limited by a scheme approved under Professional Standards Legislation.