The Easiest Way to Access First Home Buyer Support

Can You Still Access First Home Buyer Support After Divorce?

You can access first home buyer support after divorce if you meet the eligibility criteria, which in most cases means you haven't owned property in Australia or haven't owned property within a certain timeframe.

The Australian Government 5% Deposit Scheme, which came into effect in October last year, doesn't impose income caps or annual place limits. That makes it a useful option for someone rebuilding after separation who can show regular income but doesn't have a large deposit saved. The scheme allows you to purchase with just a 5% deposit without paying Lenders Mortgage Insurance because Housing Australia guarantees the portion between your deposit and 20% of the property value. You apply through a participating lender, not directly through the government.

Consider someone who sold the family home during a property settlement and is now renting. She hasn't owned property for two years and wants to purchase again. At that point, she fits the ownership test for most schemes, provided she can show stable income and has saved enough for a 5% deposit plus settlement costs. She wouldn't be classified as a first home buyer in the traditional sense, but the government schemes don't all require you to have never owned property.

How the Ownership Test Works Across Different Schemes

The ownership test varies depending on which scheme or concession you're applying for. The Australian Government 5% Deposit Scheme requires that you haven't owned property in Australia before, while the ACT Home Buyer Concession requires only that you haven't owned property in the last five years. Queensland's stamp duty concessions require that at least one applicant must not have owned or co-owned a residential property in Australia, and in some states the test applies to both you and your spouse or de facto partner.

For people going through separation, the timing matters. If you've transferred your share of the family home to your former partner as part of a settlement, you're no longer an owner from the date that transfer is registered. That date marks the point from which any waiting period starts. In our experience, buyers often assume they need to wait years before they can access support, but depending on the scheme and the state, the exclusion period can be shorter than expected.

What Property Price Caps Apply Under the 5% Deposit Scheme

Property price caps under the 5% Deposit Scheme depend on where you're buying. In New South Wales, the cap is $1,500,000 for Sydney and regional centres and $800,000 for other areas. Victoria's caps are $950,000 for Melbourne and regional centres and $650,000 elsewhere. Queensland uses $1,000,000 for Brisbane and regional centres and $700,000 for other areas. South Australia applies $900,000 for Adelaide and regional centres and $500,000 elsewhere. These are the limits set by Housing Australia from October last year.

Both the purchase price and the lender's valuation must fall at or below the cap. If you're buying in a regional area, confirm whether your suburb is classified as a regional centre or falls into the "other areas" category, because the difference can be substantial. A property in Geelong, for example, would sit under the $950,000 regional centre cap, while a property in a smaller Victorian town would be subject to the $650,000 limit.

If the property you're purchasing is close to the cap, ask your broker to arrange a valuation early. A purchase price of $945,000 in a regional centre might seem safe, but if the valuation comes back at $955,000, you're over the threshold and the scheme won't apply.

Combining State Concessions With Federal Schemes

You can generally use state stamp duty concessions and grants alongside the Australian Government 5% Deposit Scheme. In Victoria, for instance, you could access the 5% Deposit Scheme and also receive a full stamp duty exemption on a property valued up to $600,000, or a sliding concession on properties between $600,001 and $750,000. In Queensland, you could combine the scheme with a $30,000 First Home Owner Grant if you're purchasing a new home under $750,000, and also benefit from stamp duty relief on that same transaction.

The structure works because the federal scheme addresses your deposit gap, while state schemes reduce your upfront duty and, in some cases, provide cash you can use toward settlement or other costs. Someone purchasing a new townhouse in Brisbane at $680,000 with a 5% deposit would put down $34,000, avoid LMI entirely through the federal scheme, receive $30,000 from the Queensland First Home Owner Grant, and pay no stamp duty under the state's first home new home concession. That combination reduces the cash required at settlement and removes what are often the two largest upfront costs: LMI and duty.

You can't combine the 5% Deposit Scheme with Help to Buy, which is the federal shared equity program. That program allows the government to take an equity stake in your property in exchange for contributing up to 40% of the purchase price on a new home or 30% on an existing home. You'd use one or the other depending on your circumstances.

When to Use Help to Buy Instead of the 5% Deposit Scheme

Help to Buy is an equity-sharing scheme that became available in December last year. It's designed for buyers who can afford repayments but struggle to save a large deposit or meet serviceability tests. Income limits apply: $100,000 for individuals, $160,000 for joint applicants or single parents. Property price caps vary by location and can be checked using Housing Australia's postcode tool.

The government contributes up to 40% of the purchase price for a new home and up to 30% for an existing home, reducing the amount you need to borrow. You need a minimum 2% deposit. The trade-off is that the government holds a proportional equity stake and shares in any capital gain or loss when you sell or refinance.

In a scenario where you earn $85,000 and are purchasing an established home valued at $550,000, you might find that even with a 5% deposit your income doesn't comfortably service a $522,500 loan once living expenses are factored in. Under Help to Buy, the government could contribute $165,000 (30% of the purchase price), leaving you to borrow $382,500 after your $2,500 deposit, which is far more manageable. Your repayments drop, and you're still building equity in the property. When you sell or refinance, the government receives 30% of the sale price or revaluation amount.

Help to Buy is available in New South Wales, Victoria, Queensland, South Australia, Western Australia, the Australian Capital Territory and the Northern Territory. Tasmania has opted out. You can use state grants and duty concessions alongside Help to Buy in most cases, but confirm with your broker which combinations are allowed in your state.

How Stamp Duty Concessions Work If You're Buying in NSW or Queensland

New South Wales offers a full stamp duty exemption on homes valued up to $800,000 and a sliding concession on properties between $800,001 and $1,000,000. The concession applies to both new and established homes, provided you move in within 12 months of settlement and live there for at least 12 continuous months. For vacant land, a full exemption applies up to $350,000, with a concession available for land valued between $350,001 and $450,000.

Queensland's approach depends on whether you're buying new or established. For established homes, duty is calculated at the standard home concession rate, then an additional first home concession is deducted. The maximum deduction for a property valued up to $709,999 is $17,350. The concession reduces as the property value increases and reaches nil at $800,000 or above. For new homes, Queensland provides full stamp duty relief with no price cap, meaning duty is reduced to nil on the residential land component regardless of the property's value. The same full concession applies to vacant land purchases with no cap.

If you're purchasing a new townhouse in Queensland at $720,000, your stamp duty is effectively zero. If you're purchasing an established home at the same price, you'd pay duty calculated at the concessional rate minus the applicable first home concession, which would reduce but not eliminate your liability. Understanding which category your purchase falls into changes how much you need to set aside for settlement.

What Happens If You've Used the First Home Super Saver Scheme

The First Home Super Saver Scheme allows you to make voluntary contributions into your superannuation fund and later withdraw eligible amounts to use toward a home deposit. You can release up to $15,000 of contributions from any one financial year, with a total cap of $50,000. Concessional contributions are taxed at 15% rather than your marginal rate, which can result in significant tax savings if you're earning above the tax-free threshold.

You generally need to obtain a determination from the Australian Taxation Office before signing a purchase contract. If you've already owned property and are now starting over, you may still be eligible to use the scheme if you meet the first home buyer definition under tax law, which focuses on whether you've owned property in Australia. The scheme sits separately from state-based grants and concessions, so you can use it alongside other support measures, provided you satisfy the eligibility criteria for each.

Someone who contributed $12,000 per year over three years while married, but never released those funds, could apply to access up to $36,000 now if they're purchasing again and meet the ownership test. Those funds would be available within weeks of applying and could cover a significant portion of a 5% deposit.

Should You Apply for Pre-Approval Before Searching for a Property

Pre-approval confirms how much you can borrow and shows sellers you're in a position to proceed. When you're applying under a government scheme, pre-approval also confirms that the lender participates in that scheme and that your circumstances meet the requirements. Not all lenders participate in every scheme, so confirming access upfront avoids discovering limitations after you've made an offer.

Pre-approval is particularly useful if your financial situation is less straightforward, which is often the case during or after separation. Income might be a mix of employment, spousal maintenance, and child support. Assets might include a pending property settlement or funds held in trust. A broker can structure the application to reflect your actual position and work with lenders who assess non-standard income sources fairly.

We regularly see buyers who assume they won't qualify because their income has dropped or they're now self-employed, only to find that once the application is properly structured and the right lender is approached, borrowing capacity is stronger than expected. Pre-approval removes the guesswork and gives you a clear range to search within.

Call one of our team or book an appointment at a time that works for you. We'll walk through which schemes and low deposit options apply to your situation, confirm your borrowing capacity, and help you move forward with clarity.

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