Victorian Budget Ends Homebuyer Fund – What Hope Remains for First-Home Buyers?

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Victorian Budget 2025–26: First-Home Buyers Left in the Cold

The Victorian Government’s latest budget has officially brought an end to the Homebuyer Fund—a shared equity scheme that enabled eligible first-home buyers to enter the market with as little as a 5% deposit.

In a year when median prices in Melbourne and surrounding areas continue to climb toward the $1 million mark, the removal of this scheme has left many would-be buyers re-evaluating whether home ownership is still achievable.

What Was the Homebuyer Fund?

The Homebuyer Fund allowed the State Government to contribute up to 25% of a property's purchase price in exchange for a proportional share in the equity.

This model proved particularly effective in helping first-home buyers avoid lenders mortgage insurance (LMI) and qualify for loans they otherwise could not access under conventional lending standards.

For many, it was the only viable path to enter the market in an era of tightening credit and high deposit hurdles.

What Replaces It?

Nothing—at least, not immediately.

There is no new program to replace the Homebuyer Fund. And while existing participants in the scheme will continue to be supported, no further applications are being accepted.

The Government has instead cited long-term plans for broader tax reform and social housing investment, neither of which directly assist private market first-home buyers.

Stamp Duty Concessions Still Not Adjusted

Another disappointment in the Budget is the lack of any adjustment to stamp duty thresholds, which remain at:

  • Exemption under $600,000

  • Concession between $600,001 and $750,000

These thresholds have not moved in over a decade, despite Melbourne’s median house price now sitting above $940,000, and rising.

This effectively means many “entry-level” homes no longer qualify for the very concessions intended to support first-time buyers.

What Should First-Home Buyers Do Now?

The current environment demands a more cautious and well-informed approach.

Buyers must now plan for:

  • Larger deposit requirements

  • Full stamp duty assessments

  • Stricter lending scrutiny

  • Greater exposure to market corrections

At Victorian Property Settlements, we assist first-home buyers in assessing contract terms, calculating total acquisition costs (including duty and adjustments), and identifying hidden risks—especially in off-the-plan contracts, long settlements, or nomination clauses.

Victorian Property Settlements – Trusted for over 25 years by Victorian buyers and sellers.

Considering your first purchase? Get in touch for professional conveyancing advice that helps you proceed with confidence.

📩 David@quick32.com
📞 (03) 9783 0111
🌐 www.victorianpropertysettlements.com.au