Shared equity, step-by-step. The Government contributes up to 40% of a new home. You save 2%. Here's who qualifies, how the equity share works, and what "staircasing out" actually means in practice.
Help to Buy is a shared equity program from the Australian Government that took applications from 5 December 2025. It is the most generous deposit pathway in the country, but also the most restrictive: the Government co-owns part of your home, and there are strict income caps. This article explains exactly how it works.
What is shared equity?
Shared equity is a way to buy a home where someone else — usually the Government — owns a share of the property. You pay less deposit, you borrow less, your monthly repayments are lower, but you don't own 100% of the home. If the property goes up in value, the Government takes its share of the gain. If it goes down, it shares the loss.
Help to Buy is the federal version. The Government contributes up to 40% of the price of a new home or 30% of the price of an existing home. You save 2% deposit, the rest is your mortgage.
Who can apply
Help to Buy has the strictest eligibility of the major schemes:
- Citizenship: At least one applicant must be an Australian citizen. Permanent residents may qualify at some lenders' discretion, but the default is citizen only.
- Age: 18 or older.
- Income cap: $103,000 for a single applicant, $165,000 for joint applicants or single parents. This is gross taxable income, shown on the ATO Notice of Assessment.
- Property cap: Varies by state, ranging from $600,000 (NT) to $1,300,000 (NSW and major regional NSW centres).
- Property type: Owner-occupier only. Investment properties are not eligible. You must live in the home as your principal place of residence — renting out is not allowed while the Government has an equity share.
- Prior property ownership: Eligible first home buyers, OR previous owners who do not currently own property in Australia or overseas.
Source: firsthomebuyers.gov.au/help-to-buy
How the numbers actually work
Example: a couple in Brisbane, combined income $140,000, buying a $750,000 new apartment.
| Property price | $750,000 |
| Government co-owns (new home, up to 40%) | 40% = $300,000 |
| Your deposit (2%) | $15,000 |
| Your mortgage | $435,000 (58% of price) |
| Your equity at purchase | 60% = $450,000 |
The same apartment with a 10% bank loan and no Government help would require a $75,000 deposit and a $675,000 mortgage. Help to Buy reduces the deposit by $60,000 and the mortgage by $240,000. At 6% interest over 30 years, that's roughly $1,400 a month less in mortgage repayments.
Staircasing out
You don't have to stay in Help to Buy forever. The equity share is portable in three ways:
- Staircasing: You can buy back Government shares in minimum 5% increments, when you can afford to. Each buyback is priced at the current market value of the property.
- Selling the property: When you sell, the Government takes its share of the sale price (its equity % × sale price). If the property has gone up in value, the Government captures its share of the gain; if it's gone down, it shares the loss.
- Refinancing out: Once you have enough equity and income, you can refinance the whole property and pay the Government out in one go.
Your income is reviewed each year. If you no longer need the help (because your income has risen materially), the Government may ask you to begin buying back shares.
What happens if property values fall
This is the key risk of shared equity that few buyers think about. If you buy a $750K home with the Government owning 40%, and the property falls 20% to $600K, then the Government's share falls to $240K and yours to $360K. You still owe your mortgage of $435,000 — which is now more than your equity. You're in negative equity for $75,000. This is exactly the same risk as a regular mortgage, but magnified because you started with a smaller deposit. The Government shares in this loss proportionately.
What it doesn't cover
- Investment properties — owner-occupier only
- Income above the caps — use the 5% Deposit Scheme instead
- Properties above the state cap
- Citizenship: only Australian citizens qualify (default)
Annual places and program length
10,000 places per year for 4 years (40,000 total). If demand outstrips supply in a given year, the Government will allocate by application date and order of completion.
How to apply
Applications are submitted through participating lenders — the same panel of banks and non-banks that offer the 5% Deposit Scheme. The lender handles the credit assessment and the Help to Buy application in parallel. Income verification is done via the ATO's Standard Auto-Assess process; you don't need to manually provide payslips if the ATO data is current.
Help to Buy is the biggest change to Australian housing affordability in a generation. If you qualify, it's almost always better than the 5% Deposit Scheme alone — provided you're comfortable with the Government as a long-term co-owner.