New Housing Australia figures show almost 40,000 loans were written under the income-cap-free 5% Deposit Scheme in its first seven months, with about one in three going to borrowers who would have exceeded the old income caps.
Updated 1 October 2026
New figures from Housing Australia show just how far the 5% Deposit Scheme has expanded since its income caps were removed. Almost 40,000 loans were written under the scheme between October 2025 and April 2026, and about one in three of those buyers earned more than the old income limits would have allowed. For anyone still weighing up whether the scheme is worth using, the numbers are a useful reality check on who else is in the market with them.
Of the 39,704 guaranteed loans written since the scheme dropped its income caps, 13,979 went to borrowers who would have exceeded the previous limits of $125,000 for single applicants and $200,000 for joint applicants. That breaks down to roughly 6,812 single borrowers earning above $125,000 and 7,167 couples earning a combined income above $200,000. At the top end, close to 1,000 single borrowers on salaries of $200,000 or more, and around 1,251 couples with a combined income of at least $275,000, also used the scheme.
Some economists have flagged this as worth watching, arguing that higher income households are more likely to have been able to buy without the guarantee, and that removing the income test may be adding extra borrowing capacity into an already competitive market. That is one interpretation of the data. It does not change what the scheme offers a genuine first home buyer on a modest income: the ability to buy with a 5% deposit and avoid lenders mortgage insurance, regardless of how the rest of the buyer pool looks.
The scheme, formerly known as the First Home Guarantee, was expanded from 1 October 2025 to remove income limits altogether and lift the number of available places. Property price caps were set higher at the same time, broadly in line with average house prices in each area, and they were raised again from 1 July 2026. The idea behind removing the income test was to simplify eligibility so that more first home buyers, across a wider range of incomes and locations, could access the scheme without being excluded on a single threshold.
The trade-off is that a scheme open to everyone will naturally attract a wider spread of buyers, including some who would probably have found finance another way. That does not mean the scheme has stopped serving lower and middle income buyers. It means the pool of people using it now looks different to how it looked when the caps were in place, and it is worth understanding both sides before deciding whether it fits your own situation.
None of this changes the core mechanics of the scheme for an individual buyer. If you meet the eligibility rules, the scheme may still let you buy sooner with a smaller deposit and without paying for lenders mortgage insurance, which can be worth tens of thousands of dollars depending on your loan size. A few things are worth thinking through given the new data:
Your lender will still assess your income, expenses and existing debts against its own lending standards, regardless of whether you use the scheme. Removing the government's income cap does not remove the ordinary serviceability checks a lender applies to every application.
Use these tools to see how the scheme could apply to your own situation, and how it compares with the other options first home buyers have available: