Buying your first home is a major milestone and recent changes to the Federal Government’s first home buyers scheme now make it easier than ever, especially in regional areas like Port Macquarie. But these new rules come with eligibility traps, regional variations, and strategic considerations. That’s where a mortgage broker can be your most valuable guide.
What’s Changing: The 5 % Deposit / No LMI Scheme First Home Buyers Scheme
From 1 October 2025, the Australian Government is expanding its First Home Buyers Scheme to make it easier for first home buyers to purchase with just 5 % deposit, without having to pay Lenders’ Mortgage Insurance (LMI).
Key features include:
- The Government acts as a guarantor for the portion of the loan above your 5% deposit so you don’t need to pay LMI.
- No income caps from 1 October 2025, so more buyers qualify.
- Unlimited places no more waiting lists or quotas.
- Higher property price caps to reflect market conditions.
In essence, this scheme lowers the biggest barriers many first home buyers face: saving a large deposit and paying LMI.
Eligibility Requirements: What You Need to Qualify
To take advantage of the 5% deposit / no-LMI scheme, there are several eligibility criteria to satisfy. A mortgage broker helps you interpret and meet these. Key general criteria include:
First Home Buyer Status – You must be a first home buyer (i.e. not having owned property previously) or meet “previous ownership” conditions.
Deposit – you must have at least 5% of the property purchase price in genuine savings or the equivalent.
Occupancy or Use – The property must be your principal place of residence (owner occupier), meaning this scheme cannot be used for investment or rental properties.
Age / Residency – you must be 18+ years of age and an Australian Citizen of Permanent Resident, hold a valid Medicare / residency documentation.
Loan Type / Structure – The mortgage must be principal and interest, not interest only unless you are purchasing vacant land and building.
Other Costs and Serviceability – Even though LMI is waived, you still need to demonstrate you can service the loan plus play stamp duty, legal costs, inspections and other upfront fees.
In summary, many of the rules and interpretations can vary, that is why a mortgage broker will help ensure your application is clean for a smooth process and to avoid any surprises.
Property Price Caps in NSW / Regional Areas & What That Means for Port Macquarie / Mid North Coast
A crucial constraint is the maximum property value (price cap) under the scheme. That cap determines which homes are eligible for the 5 % deposit + no LMI benefit.
Some key points and regional considerations:
- Under the revamped scheme, the price cap for “rest of NSW” / non-metro areas is set at $800,000 at the release of the new scheme.
- In major regional centres, there may be higher caps as per the scheme’s regional adjustments.
- Because Port Macquarie is a growing regional hub, many homes may already be exceeding older caps. Buyers must check whether their chosen property is under the threshold. A mortgage broker can help filter eligible properties.
To put it in perspective: if you target a property in Port Macquarie or nearby that is valued under $800,000, you may qualify under the “rest of NSW” cap. But if the property is in a “regional centre” category with a higher allowable cap, that gives you some more headroom.
It’s important to stay updated, because government announcements often move caps or eligibility boundaries.
Why Use a Mortgage Broker?
You might wonder: can’t I just approach my bank or lender and see if I qualify? Yes, you can – but a mortgage broker offers several key advantages:
- Scheme Expertise & Guidance
Brokers continually study changes, interpret eligibility tweaks, and understand which lenders participate in the 5 % deposit scheme in your region. Many lenders may not support the scheme in all regions or under all lending products. A broker ensures you pick the right lender and structure. - Saving You Time & Avoiding Pitfalls
The 5 % deposit scheme has nuanced rules (e.g. “genuine savings,” occupancy rules, time limits). Brokers help you structure your finances, gather documentation, and catch red flags early – avoiding rejections, delays or wasted fees. - Tailored Lending Options
Even if you qualify for the 5 % scheme, not all lenders offer the same interest rates, flexibility, or offsets. A broker can compare across many lenders and find the best deal – balancing interest rate, fees, flexibility, and future refinance options. - Access to Regional Lending Products
In regional areas like the Mid North Coast, local understanding matters. A broker familiar with Port Macquarie and surrounding areas knows which lenders are active locally, which products suit lifestyle, and which parcels of land or house-and-land packages are more likely to fit within scheme caps. - Strategic Advice on Timing & Pre-Approval
Because scheme spots can get snapped up (even though places are now unlimited, administrative timing still matters), having a broker helping you prepare a pre-approval or reserve a spot can give you a competitive edge when property listing windows open.
Steps to Get Started — How a Broker Will Help You
- Initial chat / eligibility check
At Crafted Capital, we can start with a quick chat to understand your income, savings, credit history, employment status, and desired property price range to see if you preliminarily qualify. - Pre-approval & reserving your scheme spot
For the 5 % deposit scheme, you’ll need conditional approval from a participating lender. At Crafted Capital, we can help you reserve a “slot” in the home guarantee scheme while you find your property. - Property selection & screening
At Crafted Capital we can guide you to properties that meet scheme caps in the Port Macquarie / Mid North Coast area, balancing lifestyle goals and eligibility. - Application submission
We make it easy at Crafted Capital, compiling your paperwork, liaising with the lender, ensuring clean documentation, and pushing your application forward. - Settle & review future options
Once settled, Crafted Capital can continue advising – whether it be refinancing, extra repayments, or when your home might be eligible for grants or state schemes such as stamp duty discounts beyond the 5 % scheme.
Additional NSW First Home Buyer Incentives (Stamp Duty, Grants) to Combine
While the 5 % deposit / no-LMI scheme is powerful, in NSW there are other state-level incentives first home buyers should explore and Crafted Capital can help you combine them where possible.
- First Home Buyers Assistance Scheme (FHBAS) – stamp duty / transfer duty exemptions or reductions for eligible first home buyers: full exemption up to $800,000 (for existing/new homes) and concessional rates up to $1,000,000.
- First Home Owner (New Homes) Grant (NSW) – a $10,000 grant for new or substantially renovated homes, with eligibility thresholds e.g. home price must not exceed $600,000 for new homes.
We can help you assess whether you can stack other incentives with the federal 5 % deposit scheme (depending on rules), further lowering your cost.
Why Now Is a Smart Time for First Home Buyers in Port Macquarie
- The expanded 5 % deposit scheme lifts barriers that traditionally sidelined buyers with low savings or limited family assistance.
- Port Macquarie and the Mid North Coast remain attractive lifestyle and growth markets – though property values are rising, some homes still fall below scheme caps.
- Because many buyers may rush in once the scheme is live, preparing early (with support from Crafted Capital) gives you a first-mover advantage.
- With unlimited places and no income caps, the scheme becomes accessible to more people – but regulatory changes may adjust the details later.
If you’re planning to buy your first home in Port Macquarie or anywhere in the Mid North Coast region, especially under the new 5 % deposit / no-LMI scheme, engaging with Iain Morton from Crafted Capital is not just helpful – it’s almost essential. Iain can help you:
- Confirm eligibility (or show you what you need to do to qualify)
- Navigate property price caps and regional nuances
- Search for a lender & product that truly suits you
- Avoid costly rejections, delays or mistakes
- Strategically approach the transaction timeline
