Help to Buy vs the 5% Deposit Scheme (2026): Which One Gets You In?

By Chaice Paterson, Founder, Low Deposit Homes

The honest answer in one line: if your blocker is the deposit, the 5% Deposit Scheme is usually your path; if your blocker is borrowing power, Help to Buy is the one that can get you in. They can’t be combined, so the right choice comes down to which constraint is actually stopping you.

Side by side (2026)

	5% Deposit Scheme (First Home Guarantee)	Help to Buy (shared equity)
Deposit	5%	As little as 2% + costs
What it solves	You can service the loan but can’t save the deposit	You can’t borrow enough — income/serviceability is the ceiling
How it works	Government guarantees the gap to 20% so you pay no LMI; you own 100%	Government takes an equity share of up to 40%, so you service a smaller loan; you co-own and buy their share back over time
Income cap	None — removed entirely 1 October 2025	$100,000 single / $160,000 couples and single parents
Who’s eligible	Australian citizens and permanent residents	Australian citizens only
Price caps	~$1,000,000 metro Brisbane / $700,000 regional QLD / ~$950,000 Melbourne & Geelong / $1,500,000 Sydney	The same property price caps as the 5% Deposit Scheme in the markets we serve — about $1,000,000 in Brisbane and $950,000 in Melbourne/Geelong (some other states differ)
Combine with each other?	No — you cannot combine Help to Buy with the 5% Deposit Scheme. Pick one path.

How to choose

Ask one question: what’s actually stopping you? If you earn enough to make the repayments but can’t get the deposit together, the 5% Deposit Scheme is usually the anchor — you own 100% of the home, pay no LMI, and on a new build the $0 stamp duty brings a $1,000,000 Queensland home down to about $54,500 to get into. If the bank says you can’t borrow enough no matter your deposit, Help to Buy shrinks the loan you have to service by taking an equity share — the trade-off is shared ownership and buying that share back later, plus the citizens-only and income-cap conditions.

A note on stale information

A lot of comparison content still says the 5% scheme has income caps of $125,000 (single) or $200,000 (couple). Those caps were scrapped on 1 October 2025 — there is no income limit on the 5% Deposit Scheme as at June 2026. The income caps that remain are on Help to Buy ($100,000 single / $160,000 couples and single parents). Don’t rule yourself out of the 5% scheme on an out-of-date income test.

Work out which fits you

Use the free calculators or book a free call and we’ll tell you which path your situation points to. See also all schemes compared.

Frequently asked questions

Help to Buy vs the 5% Deposit Scheme — which is better in 2026?

Neither is universally better; it depends on your blocker. The 5% Deposit Scheme suits buyers who can service a loan but can’t save a 20% deposit (you own 100%, pay no LMI). Help to Buy suits buyers whose ceiling is borrowing power, because the government’s equity share shrinks the loan you service. You cannot combine the two.

Does the 5% Deposit Scheme have an income limit in 2026?

No. The income caps were removed entirely on 1 October 2025. The old $125,000 single / $200,000 couple caps no longer apply. Help to Buy, by contrast, does have income caps of $100,000 single / $160,000 couples and single parents.

Can permanent residents use these schemes?

The 5% Deposit Scheme is open to Australian citizens and permanent residents. Help to Buy is open to Australian citizens only.

Can I use Help to Buy and the 5% Deposit Scheme together?

No. They cannot be combined — you choose one path based on whether your blocker is the deposit (5% scheme) or borrowing power (Help to Buy).

Explore more first home buyer guides

General information only, current as at June 2026 – not financial or credit advice. Eligibility, caps and dates depend on your circumstances and can change; confirm current details before acting. Low Deposit Homes operates under Winning Homes Australia Pty Ltd.