a shared equity scheme for first-time homebuyers. Under this scheme, eligible individuals and couples can purchase a home with zero deposit, with the government contributing a 20% share. The scheme is open to couples earning up to $200,000 and single people earning up to $150,000, with additional allowances for children.
The shared equity scheme enables participants to buy a home with government assistance. The government retains a share in the property, which is paid back when the home is sold or when the participant buys out the government's share. The scheme has a cap on eligible property values, with existing houses capped at $600,000 and new builds capped at $800,000.
Labor's scheme differs from the Liberals' MyHome scheme, introduced in 2022. MyHome requires a minimum deposit of 2% and is available to couples earning up to $107,000 and single people earning up to $93,000. The government's equity share under MyHome varies depending on whether the property is new or existing, with a maximum of $200,000 or 40% for new builds and $150,000 or 30% for existing homes.
Economist Saul Eslake has expressed concerns about shared equity schemes, arguing that they benefit existing homeowners while potentially driving up housing prices. He notes that despite decades of such schemes, homeownership rates have declined, particularly among younger Australians. Eslake suggests that the best aspect of the scheme is that taxpayers will eventually recoup their investment when the homes are sold, assuming prices continue to rise.