Buying your first home in regional Australia just got more accessible. If saving a 20% deposit feels like an impossible mountain to climb, the Regional First Home Guarantee (RFHBG) might be your ticket to homeownership sooner than you thought.
- The Regional First Home Guarantee (RFHBG) lets eligible buyers purchase a home with just a 5% deposit
- No Lender's Mortgage Insurance (LMI) required, potentially saving you thousands
- 10,000 places are available for FY2024-25
- Labor has proposed eliminating income caps and increasing property price limits starting January 2026
Let's cut through the jargon and explain exactly how this scheme works, who qualifies, and what potential changes are on the horizon if Labor wins the next election.
What is the Regional First Home Guarantee?
The RFHBG is part of the broader Home Guarantee Scheme (HGS), an Australian Government initiative designed to help eligible home buyers enter the property market faster.
Here's the deal: Instead of needing a 20% deposit (and let's be real, who has that kind of cash lying around?), you only need 5%. The government guarantees up to 15% of the property's value, which means you can avoid paying Lender's Mortgage Insurance (LMI).
For context, LMI typically costs around $23,000 for the average first home buyer. That's money back in your pocket.
Who is eligible for the Regional First Home Guarantee?
To qualify for the RFHBG, you need to meet these criteria:
- Be an Australian citizen or permanent resident
- Be at least 18 years old
- Earn up to $125,000 annually as an individual or $200,000 for couples (based on your ATO Notice of Assessment)
- Intend to live in the property (not an investment)
- Have not previously owned property in Australia, or haven't owned property in the last 10 years
- Have a minimum 5% deposit saved (although lenders may require more depending on your circumstances)
What's considered a "regional area"?
Not sure if your dream location qualifies as "regional"? Here's how it's defined:
- Areas outside the capital cities of each state and the Northern Territory
- Norfolk Island, Jervis Bay, Christmas Island, and Cocos (Keeling) Islands are also included
The greater capital city areas and the entire ACT are excluded from the RFHBG, but buyers in these areas might still qualify for other guarantees like the First Home Guarantee or Family Home Guarantee.
Pro tip: Use the official Regional Checker tool to confirm if your desired suburb is eligible.
What property types can you buy?
Under the RFHBG, you can purchase:
- Existing houses, townhouses, or apartments
- House and land packages
- Land with a separate contract to build
- Off-the-plan apartments or townhouses
Remember that property price caps apply depending on your location. These caps ensure the scheme targets properties at appropriate price points in each regional area.
Labor's proposed changes: election 2025
If Labor wins the next election, they have proposed some major changes to the Home Guarantee Scheme are proposed to start from January 1, 2026:
No more income caps or place limits
Labor plans to remove the income caps (currently $125,000 for singles and $200,000 for couples) and eliminate the cap on places (currently limited to 10,000 per year for the RFHBG).
Increased property price limits
The proposal includes significant increases to property price caps across the country:
100,000 new homes for first-time buyers
Additionally, Labor has promised to invest $10 billion to build 100,000 homes specifically for first home buyers, with construction planned to start in 2026-27.
How to apply for the Regional First Home Guarantee
Ready to take the plunge? Here's how to get started:
- Check your eligibility using the official Eligibility Tool
- Contact a participating lender or speak with us as your mortgage broker
- Get your documentation ready (especially your latest Notice of Assessment from the ATO)
- Find your dream property within the price caps for your region
- Apply for pre-approval through a participating lender
Important: The scheme is administered by Housing Australia, but applications can only be made through participating lenders or mortgage brokers like us.
Why use a mortgage broker for your RFHBG application?
Navigating government schemes can be confusing. As mortgage brokers, we can:
- Help determine your eligibility across all Home Guarantee Schemes
- Compare options from multiple participating lenders
- Ensure your application is properly prepared
- Guide you through the entire process from application to settlement
The bottom line
Whether you're looking to buy now under the current RFHBG or waiting to see if Labor's proposed changes come into effect, the path to homeownership in regional Australia is becoming more accessible.
With property prices continuing to challenge first home buyers, schemes like the RFHBG provide a realistic pathway to owning your own slice of regional Australia without waiting years to save a 20% deposit.
Frequently asked questions
Can I use the RFHBG for an investment property?
No, you must intend to live in the property as your principal place of residence.
What happens if property values fall and I end up with negative equity?
You're still responsible for repaying the full loan amount, regardless of property value changes.
Can I use the RFHBG with other government grants?
Yes, in many cases the RFHBG can be used alongside state-based first home buyer grants and concessions.
Do I need to pay back the government guarantee?
No, the guarantee is not a loan. It simply allows you to avoid paying LMI while having a smaller deposit.
What's the difference between the RFHBG and the First Home Guarantee?
The main difference is location—the RFHBG is specifically for regional areas, while the First Home Guarantee is available nationwide.
