Help to Buy Shared Equity Scheme Victoria: How It Works in 2026
Help to Buy Shared Equity Scheme Victoria: How It Works in 2026
If you have been researching shared equity schemes in Victoria, you may have come across the Victorian Homebuyer Fund — and found that it is now closed. The state scheme was shut to new applicants in September 2025. In its place, Victorian buyers now access the federal Help to Buy program, which launched on 5 December 2025. Here is what the transition means for you, and what Help to Buy actually involves.
The Victorian Homebuyer Fund Is Closed
The Victorian Homebuyer Fund (VHF) allowed the state government to contribute up to 25% of a property's purchase price — or 35% for eligible Aboriginal and Torres Strait Islander buyers — in exchange for a proportional equity share. Buyers needed only a 5% deposit (3.5% for Indigenous buyers), avoided LMI, and had substantially reduced mortgage repayments. The government shared in any capital gains when the property was sold.
The VHF was well-regarded and heavily subscribed. It has now permanently closed to new applications. The State Revenue Office continues to administer existing participants, but no new applications are being accepted. If you are a new buyer looking for shared equity support, Help to Buy is the only federal option.
How the Federal Help to Buy Scheme Works
Help to Buy operates on the same shared equity principle as the VHF, but with modified parameters set federally.
Government equity contribution:
- Up to 40% of the purchase price for newly built homes
- Up to 30% of the purchase price for existing homes
Minimum deposit required:
- 2% of the purchase price from the buyer
Eligible applicants:
- Australian citizens aged 18 or older
- Must not currently own property in Australia
- Must intend to occupy the property as a principal place of residence
The scheme is designed to support 40,000 households across Australia over a four-year period. Victoria's enabling legislation passed in late 2025, allowing the federal scheme to operate in the state.
Income Caps: Who Qualifies
Unlike the First Home Guarantee, Help to Buy retains strict income limits. These are based on annual taxable income:
- Individual applicants: Maximum $100,000
- Couples and single parents: Maximum $160,000
These income limits are set at the federal level and apply nationally. They position Help to Buy as a scheme for low-to-middle income earners — buyers who may be unable to save a conventional deposit but whose income is stable enough to service a mortgage.
If your income exceeds these thresholds, Help to Buy is not available to you. The First Home Guarantee (which has no income caps as of October 2025) is likely the better fit.
Free Download
Get the Victoria Quick-Start Home Buying Checklist
Everything in this article as a printable checklist — plus action plans and reference guides you can start using today.
Property Price Caps in Victoria
The maximum purchase price under Help to Buy depends on where you are buying:
| Location | Maximum Price |
|---|---|
| Melbourne and Geelong | $950,000 |
| Rest of Regional Victoria | $650,000 |
Geelong receives the same $950,000 cap as metropolitan Melbourne due to an explicit legislative designation recognising it as a regional centre with metro-equivalent property prices.
The $650,000 regional cap is a meaningful constraint outside major centres. In many regional Victorian towns, however, properties are available well below this threshold — which is where Help to Buy tends to work best for regional buyers.
What Shared Ownership Actually Means Long-Term
Shared equity schemes are not free money. The government takes a proportional ownership stake in your property — and that stake participates in the property's performance over time.
When you sell: The government receives its proportional share of the sale price, including any capital growth. If you bought with a 30% government contribution and the property doubles in value, the government receives 30% of the doubled sale price — not just the original contribution.
When you buy out the government: You can progressively reduce the government's share over time by buying back portions of equity at current market value. This means if the property has appreciated, you will pay more to buy out the government's stake than the government originally contributed.
If the property falls in value: The government also shares proportionally in any loss. Unlike a standard mortgage where negative equity sits entirely with the buyer, shared equity means the government's portion of the loss is absorbed by the government.
For buyers who plan to hold the property long-term and buy out the government's share progressively, shared equity is genuinely useful: lower entry costs, no LMI, reduced mortgage. For buyers who expect rapid capital growth and want to fully own the asset as quickly as possible, the long-term cost of shared equity increases with property appreciation.
Help to Buy vs. First Home Guarantee: Which One Fits Your Situation?
| Feature | Help to Buy | First Home Guarantee |
|---|---|---|
| Minimum deposit | 2% | 5% |
| Income limit | $100K individual / $160K couple | None |
| Government equity stake | Yes (30–40%) | No |
| Property price cap (Melbourne) | $950,000 | $950,000 |
| LMI avoided | Yes | Yes |
| Best for | Lower-income buyers, maximum deposit flexibility | Wider income range |
If your income is under $100,000 (individual) or $160,000 (couple) and you want the lowest possible deposit requirement, Help to Buy offers better entry conditions. If your income exceeds these limits, or you want to fully own your property without a government equity stake, the First Home Guarantee is the cleaner path.
Can You Combine Help to Buy with Other Schemes?
Help to Buy operates independently and cannot be combined with the First Home Guarantee — you choose one or the other. However:
- Help to Buy does not prevent you from claiming the First Home Owner Grant ($10,000 on eligible new homes under $750,000), provided the property meets all FHOG eligibility requirements.
- The first home buyer stamp duty exemption or concession still applies to the full dutiable value of the property, calculated on the contract price before any government equity contribution adjustments.
Applying for Help to Buy
Applications are made through participating lenders — you do not apply directly to the federal government. The lender assesses your income and financial position, confirms your eligibility, and manages the government's equity contribution as part of the settlement process. Housing Australia maintains a list of participating lenders.
Given that Help to Buy launched only in December 2025 and lender participation is being progressively expanded, it is worth checking current participating lender lists before assuming your preferred bank is involved.
The Victoria First Home Buyer Guide covers Help to Buy, the First Home Guarantee, and the First Home Owner Grant side-by-side — with worked financial comparisons at different purchase prices so you can calculate which combination suits your situation. Get the complete guide at firsthomestartguide.com/au/victoria/first-home/.
Get Your Free Victoria Quick-Start Home Buying Checklist
Download the Victoria Quick-Start Home Buying Checklist — a printable guide with checklists, scripts, and action plans you can start using today.