Home guarantee scheme changes brought forward, property bounces

The Labor government’s decision to bring forward its Home Guarantee Scheme changes from January 2026 to October 2025 has seen a big bounce in market sentiment.

The scheme has been in operation for a few years, allowing first time buyers to borrow up to 95% without paying mortgage insurance. The scheme previously had price and income caps.

Under the changes, the price caps have increased to $1.5m for Sydney (and different for each other city) while the income caps have been completely removed. That means first time buyers can now access the scheme without any income limits.

In reality, those on super high incomes will probably have more than a 5% deposit or already be in the market. The scheme is most likely to attract around 70,000 participants in its first full year post changes.

This has come at the same time as interest rates are being cut and housing supply remains at depressed levels.

My sources in the property market are telling me that there has been an immediate bounce in sentiment with more buyers in the market, even though the changes don’t come into effect until October.

In this week’s audio podcast episode, I discuss the impact on the market and the areas I think will do best in terms of pricing.