Buying your first home in Victoria is one of the most significant financial decisions you'll ever make — and in 2026, there's more government support available than ever before. Between state grants, federal schemes, stamp duty concessions, and specialist first home buyer loan products, an eligible buyer could reduce their upfront costs by $40,000 or more compared to purchasing without any assistance. Yet many first home buyers leave money on the table simply because they're not aware of what's available or how to combine multiple programs effectively.
The First Home Owner Grant (FHOG) — Victoria
The Victorian First Home Owner Grant provides $10,000 to eligible first home buyers who purchase or build a new home valued at up to $750,000. To qualify, you must be an Australian citizen or permanent resident, be 18 or older, and neither you nor your co-purchaser can have previously owned a home in Australia. The property must also be your primary place of residence for at least 12 continuous months after settlement. The grant applies to newly built homes, off-the-plan purchases, and substantially renovated homes — not established properties.
"Combining the FHOG, First Home Guarantee, and stamp duty concession, an eligible Victorian buyer could reduce upfront costs by over $40,000."
Stamp Duty Concessions for First Home Buyers in Victoria
Victoria offers meaningful stamp duty relief for first home buyers. Properties valued at $600,000 or less attract a full stamp duty exemption for eligible first home buyers — saving up to approximately $31,000. Properties between $600,001 and $750,000 receive a partial concession on a sliding scale. These concessions apply to established properties (unlike the FHOG, which is limited to new builds). For buyers targeting established homes in Melbourne's inner and middle suburbs, the stamp duty exemption is often the most valuable single benefit available.
The Federal First Home Guarantee
The Federal Government's First Home Guarantee (part of the Home Guarantee Scheme administered by Housing Australia) allows eligible first home buyers to purchase a property with as little as a 5% deposit without paying Lenders Mortgage Insurance (LMI). The government acts as guarantor for 15% of the loan, allowing borrowers to access up to 95% LVR lending from participating lenders. From 1 October 2025, the annual 35,000-place cap was abolished — the Guarantee is now available to every eligible applicant. Property price caps apply and vary by location — in Melbourne, the cap was raised to $950,000 (up from $800,000).
The Help to Buy Scheme (2026 Update)
The Federal Government's Help to Buy scheme launched in December 2025 and is now accepting applications. Under the shared equity program, the government contributes up to 40% of the purchase price of a new home (or 30% for an established property) — dramatically reducing borrowing requirements and the deposit needed. A minimum 2% deposit is required. Places are income-tested ($100,000 for individuals, $160,000 for joint applicants and single parents), and 10,000 places are available per year. Currently Bank Australia and CBA are participating lenders — with Bank Australia accepting applications via mortgage brokers. The scheme is not yet available in Tasmania. Contact your broker for current eligibility and lender availability.
Lenders Mortgage Insurance: What It Costs and How to Avoid It
Lenders Mortgage Insurance (LMI) protects the lender (not you) if you default on the loan when your LVR exceeds 80%. For a $600,000 purchase with a 10% deposit, LMI can add $8,000 to $15,000 to your loan — either paid upfront or capitalised into the loan balance. LMI can be avoided by saving a 20% deposit, using the First Home Guarantee, having a family guarantor, or accessing a select group of lenders who waive LMI for certain professions (doctors, lawyers, accountants, and other approved occupations).
How Much Do You Actually Need to Buy Your First Home?
- Deposit: minimum 5% of the purchase price (more if not using the First Home Guarantee)
- Stamp duty: nil for properties under $600,000 for eligible first home buyers in Victoria
- Conveyancing fees: approximately $1,500 to $2,500 for a standard residential purchase
- Building and pest inspection: approximately $400 to $700
- Lender fees: application, valuation, and settlement fees — often $0 to $700 with most lenders
- Moving costs, connection fees, and a cash buffer for unexpected repairs post-settlement
Getting Your First Home Loan Application Right
First home buyer applications are assessed the same way as any other mortgage — income, expenses, credit history, and deposit stability. First home buyers often underestimate how significantly HECS/HELP debt, credit card limits, and Buy Now Pay Later commitments affect their borrowing capacity. A broker can model your borrowing capacity accurately before you apply, identify any issues, recommend which lenders are most suitable for your profile, and ensure all available grants and schemes are factored into your application.
GS Capital specialises in first home buyer finance across Melbourne and broader Victoria. We're bilingual (English and Mandarin), MFAA-accredited, and our residential service is completely free to you. Book your free consultation today.