From 1 October 2025, the Federal Government’s expansion of the Home Guarantee Scheme (HGS) will reshape how first home buyers purchase property in New South Wales. While this update has generated excitement, it also introduces new layers of complexity — especially around stamp duty, income thresholds, and NSW law.
At CM Lawyers in Marrickville, we’re here to help you navigate these changes with clarity and confidence. Below, we explain what’s changing, what remains the same, and how our team can help you make informed legal and financial decisions when buying your first home.
Understanding the Expanded Home Guarantee Scheme
The expanded Home Guarantee Scheme (HGS) allows eligible buyers to purchase property with a 5% deposit, without paying Lenders Mortgage Insurance (LMI) — a potential saving of tens of thousands of dollars.
Under the updated scheme:
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Sydney and major regional centres: Price cap lifted to $1.5 million
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Other NSW regions: Cap lifted to $800,000
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No income limits: Open to higher-earning buyers
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Unlimited places: No more application quotas
It’s important to note that the HGS is a guarantee, not a grant. The government guarantees part of your loan with the bank — it doesn’t contribute cash toward your deposit.
How NSW Law Interacts with the Federal Scheme
While this is a Federal initiative, NSW home buyers must still comply with local property laws and tax obligations. Many first home buyers are surprised to learn that even with the higher HGS cap, NSW stamp duty thresholds remain unchanged.
Here’s what that means in practice:
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Under the Duties Act 1997 (NSW):
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No stamp duty on homes up to $800,000
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Concessional duty between $800,000–$1 million
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Full stamp duty applies to properties above $1 million
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The First Home Owner Grant (New Homes) Act 2000 (NSW) still provides a $10,000 grant for eligible new homes.
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The Help to Buy (Commonwealth Powers) Act 2025 (NSW) — launching later in 2025 — will be a shared equity scheme, separate from the HGS.
In short, you can buy a $1.4 million Sydney apartment under the new scheme with a 5% deposit and no LMI — but you’ll still pay full NSW stamp duty.
That’s where legal guidance becomes critical.
Common Buyer Misunderstandings (and How We Help Fix Them)
Our experience shows that most buyers misunderstand how these programs overlap. Here are a few myths we regularly correct:
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“The government will pay my deposit.”
Not true — the HGS is a loan guarantee, not a cash payment.
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“I don’t have to pay stamp duty on a $1.5m property.”
Incorrect — NSW duty relief still caps at $1 million.
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“The Help to Buy and Home Guarantee schemes are the same.”
They are entirely separate. The Help to Buy scheme (coming later in 2025) involves shared ownership with the government.
At CM Lawyers, we simplify the fine print — explaining how these schemes interact, what you’ll actually pay, and what risks to consider before signing a contract.
You may be interested in First Time Home Buyers – Not considering All Aspects of the Property.
Worked Example: How the Scheme Works in Practice
Let’s look at a few realistic scenarios for NSW buyers:
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Parramatta (Unit – $750,000)
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Eligible for HGS and full stamp duty exemption under FHBAS.
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You could buy with a 5% deposit ($37,500) and no LMI.
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Bankstown (Townhouse – $950,000)
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Eligible for HGS and concessional duty.
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Around $15,000–$20,000 in stamp duty still applies.
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Ryde (House – $1.4 million)
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Eligible for HGS but no duty relief — full NSW stamp duty applies.
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Still, you save $50,000+ in LMI.
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These examples show why individual legal advice is essential — your savings depend on property type, value, and location.
How CM Lawyers Helps NSW First Home Buyers
As an established Marrickville law firm with over 30 years of property experience, we help first home buyers across NSW understand and complete every legal step of purchasing their property — from contract review to settlement.
Our Services Include
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Eligibility review – We confirm whether you qualify for the HGS or other NSW programs.
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Contract and loan review – We examine your contract for sale and lender terms to ensure legal compliance and protection.
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Stamp duty advice – We calculate exact duty obligations under NSW law.
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First Home Owner Grant applications – We handle the paperwork and submissions.
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Conveyancing and settlement – We guide you from offer to ownership.
With CM Lawyers, you’ll have a dedicated solicitor ensuring your purchase is legally sound, financially informed, and completed on time.
Why Choose CM Lawyers
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Local Expertise: Based in Marrickville, we understand the Inner West property market and broader NSW conditions.
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Fixed-Fee Services: Transparent, predictable costs with no surprises.
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Plain-English Advice: We translate complex laws into clear, actionable guidance.
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End-to-End Support: From pre-approval to keys in hand, we stay with you every step of the way.
Our goal is to help first home buyers feel confident, not confused — and to secure your first property without unnecessary risk.
Preparing for the October 2025 Changes
If you’re planning to buy later this year or in 2026, now is the time to prepare. Remember that it’s crucial to sign a contract before obtaining Legal Advice.
By consulting a lawyer early, you can:
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Confirm whether your preferred property fits within HGS price caps.
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Understand your true upfront costs (stamp duty, deposits, lender fees).
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Avoid contracts that overstate or misrepresent eligibility.
We can also help you coordinate with mortgage brokers or financial planners to ensure every aspect of your purchase is structured correctly.
Book a Fixed-Fee First Home Buyer Consultation
From 1 October 2025, the NSW property landscape will shift dramatically. Whether you’re buying your first apartment or upgrading to a family home, legal clarity will be essential.
At CM Lawyers, we make the process simple, transparent, and stress-free.
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