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NSW shared equity scheme for homebuyers: Who is eligible?

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In 2022, the NSW government announced a $780.4 million shared equity scheme, which it hopes will help boost home ownership by reducing the upfront and ongoing costs of taking out a home loan

Under the scheme, the NSW government will make an equity contribution of up to 40 per cent on the purchase price of new homes and 30 per cent on the purchase price of existing homes.

Importantly, the scheme will only be available to single parents with children under 18, singles aged 50 or above, and select frontline workers (teachers, nurses and police officers) who have not owned a property before.

NSW Premier Dominic Perrottet said the program will be part of a "suite of measures" aimed at addressing housing affordability, with more changes expected to be announced when the state budget is handed down this Tuesday. 

"We want to make sure that people right across New South Wales have that opportunity because we know home ownership is crucial to growing wealth," he said.

Participants won’t be required to make repayments on the portion contributed by the government, however voluntary payments can be made with a view towards owning the property outright. 

A trial version of the scheme will commence in January 2023, with 3,000 places made available each financial year for two years. If successful, the state government has said the number of available slots could be doubled.

Read on for an overview of the scheme and the eligibility requirements.

Who is the shared equity scheme for?

The NSW shared equity scheme won’t be available to Australians across the board. You’ll only be eligible to apply for the scheme if you are:

  • A single parent of a child or children under 18 years of age
  • A single person 50 years of age or above 
  • A first home buyer key worker (that is, a nurse, teacher or police officer).

What do I need to be eligible?

You’ll also need to tick the following boxes before you can apply:

  • You must be at least 18 years old
  • You must be an Australian or new Zealand citizen, or a permanent Australian resident
  • You must have a deposit of at least 2% of the property’s value
  • You must not own any land in Australia or overseas at the time of purchase
  • The property must serve as your principal place of residence
  • You must be unable to service the mortgage without the assistance of the government’s shared equity scheme.

Are there any income caps?

Yes. For singles, gross income must not exceed $90,000. For couples, combined gross income must not exceed $120,000.

Are there any property price caps?

If you’re planning to buy a home in Sydney or another major regional centre in NSW (Newcastle, Lake Macquarie, Illawarra, Central Coast, North Coast of NSW), the maximum property price is $950,000. 

In other regional areas, the maximum property price is $600,000.

What are my ongoing obligations?

Applicants will need to maintain their eligibility throughout the scheme. This will mean: 

  • A review will be conducted each year in which participants will be asked to provide evidence of their continued eligibility.
  • Participants must ensure their property is well-maintained. Additionally, modifications or renovations which might affect the value of the property must be approved by the government.
  • Property costs (e.g. council rates, body corporate fees, utilities, and loan repayments) must be covered by the participant.

When does the scheme start?

The scheme is scheduled to commence in January 2023. The NSW government will be accepting applications over two financial years (2022-23 and 2023-24).

How many places will be made available?

The NSW government will make 3,000 places available each financial year, however this could be increased in the future.

Will participants be eligible for any other grants or assistance?

Yes. The NSW government has said that those participating in the shared equity scheme will also be able to apply for existing first home buyer grants and schemes, so long as they are eligible. They can also benefit from any available stamp duty or land tax concessions. 

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Niko Iliakis
Niko Iliakis
Money writer

Niko Iliakis is a finance journalist at Mozo specialising in home loans, property and interest rate movements. With an eye for facts and figures, Niko deep-dives into topics to help readers understand key info and make more informed financial decisions. He is ASIC RG146 (Tier 2) certified for general advice.

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