From 1 October 2025, the Federal Government is rolling out significant changes to the Home Guarantee Scheme (HGS), and for first-home buyers and families across Sydney, it could materially change what’s achievable in the current market.

With these updates landing just as Spring property activity ramps up, buyers who prepare early will be best positioned to compete.

Below is what’s changing, how it may impact the Sydney market, and what smart buyers should be doing now.

What’s Changing Under the Home Guarantee Scheme?

The expanded Home Guarantee Scheme introduces several major shifts:

• Unlimited places
  Allocation caps are being removed, reducing the risk of missing out once quotas are filled.

• No income caps
  Dual-income households previously excluded may now qualify.

• Higher property price caps
  Expected to reach up to $1.5 million in Sydney, depending on postcode.

• Buy with a 5% deposit and no LMI
  The government guarantees part of the loan, helping buyers avoid $20,000–$40,000+ in Lenders Mortgage Insurance.

For many Sydney buyers, this removes one of the biggest hurdles: the need to save a full 20% deposit.

What This Means for Sydney Buyers

These changes significantly lower the upfront cash required to buy a home in Sydney, particularly when combined with existing NSW government incentives, including:

• Stamp duty exemptions on homes up to $800,000

• Stamp duty concessions on homes up to $1 million

• $10,000 First Home Owner Grant for eligible new builds or substantially renovated homes

Together, these measures can materially improve buying power and speed up market entry for first-home buyers and young families.

Likely Market Impacts This Spring

With the HGS changes taking effect in peak Spring selling season, we expect several flow-on effects across Sydney:

• Increased competition in the $700,000–$1.6 million price range

• Strong demand for units, townhouses, and family homes

• Heightened buyer activity in areas such as:

  • Inner West

  • Lower North Shore fringe

  • St George & Sutherland Shire

  • Selected Western Sydney suburbs

Many buyers are likely to delay purchases until after 1 October, which may intensify October auctions, shorten days on market, and firm up price guides.

What If You’re Buying Above the HGS Price Cap?

Even buyers purchasing above the new limits won’t be immune to the effects.

Likely flow-on impacts include:

• Buyers priced out under $1.5m pushing into the $1.6m–$2m range

• Sellers just above the cap adjusting expectations upward

• Upgraders benefiting from stronger prices on sub-$1m properties, helping them move up the ladder

In short, the changes will influence competition well beyond the HGS thresholds.

NSW Buyer Incentives That Still Stack

Eligible buyers may be able to combine the HGS with:

• Stamp duty exemptions (up to $800k)

• Stamp duty concessions (up to $1m)

• $10,000 First Home Owner Grant (new or substantially renovated homes)

Used strategically, these incentives can significantly reduce the total cost of buying.

Smart Buyer Moves to Make Now

If you’re planning to buy in 2025, preparation is critical:

• Secure early pre-approval with lenders participating in the HGS

• Confirm your postcode price cap using Housing Australia’s checker

• Line up your solicitor, building inspector, and finance broker

• Be auction-ready with a clear walk-away price

• Consider pre-auction offers where appropriate

• Compare new builds vs established homes to maximise grant eligibility

How a Buyer’s Agent Can Help

While the HGS reduces financial barriers, it doesn’t make the Sydney market any less competitive.

A professional buyer’s agent can help you:

• Access on- and off-market opportunities

• Assess true market value (not just price guides)

• Negotiate strategically in high-pressure conditions

• Manage due diligence and avoid costly contract mistakes

Final Thoughts

The 1 October 2025 Home Guarantee Scheme changes open the door for a broader group of Sydney buyers, but they also arrive at a time of increasing competition.

Those who prepare early, understand the rules, and act strategically will have the advantage.

If you’d like help navigating this unique buying window, the team at Buyers Market Buyers Agents is here to guide you.

Book a free strategy call today and get ahead of the Spring rush.