What Labor’s election win means for first home buyers.

The recent federal election saw the Labor Party secure a decisive victory, ushering in a wave of proposed housing reforms that could significantly benefit first home buyers. If you're planning to enter the property market, here’s what Labor’s housing policies could mean for your homeownership journey.

Explore your options today and see how these changes could help you take the first step toward owning your home.

5% home deposit without Lenders Mortgage Insurance (LMI)

One of the most impactful promises is the expansion of the First Home Guarantee. From 2026, eligible first home buyers will be able to purchase a property with just a 5% deposit, without paying Lenders Mortgage Insurance (LMI)—a cost that typically adds around $23,000 to a home loan.

Labor plans to:

• Remove income and place caps
• Increase property price thresholds
• Extend access to more buyers

For example:

• In Sydney, a $1.5 million home could be secured with a $75,000 deposit.
• In Queensland, a $850,000 home could be purchased with just $42,500 down.

This initiative is designed to make home ownership more accessible and reduce upfront costs for first-time buyers.

100,000 New homes for first home buyers

The Albanese Government has committed $10 billion to build 100,000 new homes exclusively for first home buyers. Construction is set to begin in 2026-27, with move-ins expected the following financial year. This investment aims to increase housing supply and ease affordability pressures.

Help to Buy Scheme expansion

Labor is also enhancing the Help to Buy scheme, which allows eligible buyers to purchase a home with as little as a 2% deposit, while the government contributes 30-40% equity.

Key updates include:

• Raising income caps to $100,000 for individuals and $160,000 for couples or single parents
• Increasing property price thresholds
• 40,000 places available over four years, starting in 2025

This shared equity model is designed to lower mortgage repayments and make it easier for Australians to enter the property market.

Ban on foreign investors

To improve housing affordability, Labor will implement a two-year ban on foreign investors purchasing existing residential properties, starting 1 April 2025. This measure is intended to prioritise housing for Australian residents and reduce competition in the market.

Investment in Prefabricated and Modular Homes

To accelerate housing construction, Labor is investing:

• $54 million in advanced manufacturing for prefabricated and modular homes
• $120 million to help states cut red tape and speed up development approvals

These initiatives aim to boost housing supply and reduce construction timelines.

Broader cost of living relief

In addition to housing reforms, Labor’s broader cost-of-living measures include:

• New tax cuts
• Energy bill relief
• Reduced costs for medicines and student debt

These policies are designed to ease financial pressure and support Australians in achieving homeownership.

Ready to buy your first home?

If you're wondering how these government initiatives could help you get on the property ladder, FinancePath is here to guide you. Our expert mortgage advisers can help you navigate your options and find the right solution for your needs.