A year after more than 100,000 first home buyers used the expanded scheme, those who took the plunge are divided between relief at finally owning and regret over what they paid.
The federal government’s expanded 5 per cent Deposit Scheme has reached its first birthday, with 102,594 first home buyers supported in the year since the changes took effect on 1 October 2025.
The expansion opened the scheme to all first home buyers, removed income thresholds, uncapped the number of places and increased property price limits.
The government said the 5 per cent Deposit Scheme has supported more than 280,000 Australians since 2022.
It also estimated the scheme has saved Australians more than $2.5 billion in lenders mortgage insurance (LMI), including $1.4 billion in the past year.
For a buyer purchasing a median-priced home with a 5 per cent deposit, estimated LMI savings have been around $23,700.
The government said saving for a deposit remains one of the biggest barriers to home ownership, with some purchasers saving for up to 11 years.
It said the 5 per cent Deposit Scheme allowed first home buyers to buy sooner and get out of the rental market and into their own home.
Prime Minister Anthony Albanese said the scheme has helped Australians get their foot in the door and achieve the dream of home ownership.
“The expanded 5 per cent deposit scheme removes barriers for first home buyers, helps them get into their own home faster and saves them tens of thousands of dollars," Albanese said.
Data showed that Victoria recorded the highest number of buyers supported under the scheme since Labor came to government, with 89,375, including 33,413 in the past year.
NSW followed with 76,285 overall and 28,158 in the past year, while Queensland recorded 61,675 overall and 20,125 in the past year.
But while the first birthday comes with strong figures, the buyers who used the scheme have had very different experiences.
On Reddit, recent first home buyers have shared everything from relief at escaping the rental market to regret over buying at what they now believe was the wrong time.
For some, the biggest relief was simply to have control over where they live.
“Good, finally paying the bank and not the landlord, still renovating and probably will be renovating for the next 2 years, but at least it’s mine”, one buyer said.
Another buyer who purchased with a 5 per cent deposit said the mortgage was difficult, but they were still enjoying the home and its location.
“I’m on my third year living in the place I bought with a 5 per cent deposit. I couldn’t complain about the 10–15 minute travel from work to my place via tram. Close to CBD as well. Struggling with the mortgage but it’s nice to have a place on your own.”
For others, their financial position has improved since purchasing.
One buyer who settled 11 months ago with a 10 per cent deposit said their property had increased in value by $85,000, taking their loan-to-value ratio to 80 per cent.
“I paid what I’d say was a fair price last year; I don’t feel I overpaid or underpaid but saw lots of properties as mine sell for ridiculous amounts,” they said.
“I figure it will be okay! I have a bit of a buffer in my offset if things go bonkers.”
But for buyers who believe they purchased too early, the first year has brought a very different experience.
One buyer who purchased with a 5 per cent deposit said they had “rushed in to buy” because they feared being locked out of the market.
“Now, as you say, after years of saving I’m seeing similar go for $100,000 less than I paid, or larger/better places go for what I paid,” they said.
Another buyer purchased one month before the changes were announced and said they wished they had waited.
“I didn’t know what they’d be and was afraid they wouldn’t be enough and prices would just keep rising and lock me out,” they said.
For some, the regrets were tied to the price they paid and how much they borrowed.
One recent first home buyer said they were already regretting their purchase before settlement after deciding they had gone beyond their capacity.
“I recently purchased a house in Sydney West as an FHB, the settlement is in a week’s time, but I’m already regretting the purchase, and I’m severely stressed out because I feel I didn’t get a good price and went way over my capacity,” they said.
Another buyer said they should have waited and saved $50,000.
Redditors showed that the pressure didn’t stop at the property’s value, with the bigger concern being whether a large mortgage left enough financial flexibility as costs rise.
One buyer said they were now in a position where they “can’t get sick or lose [their] job” and “can’t move for work”.
Another 5 per cent deposit buyer said they had cut their spending and were aggressively paying down the mortgage.
“I’ve basically reduced my outgoings to as little as possible and will need to hunker down a bit to ride out the high interest rates, and load up the extra payments and squirrel away cash in my offset,” they said.
The financial pressure has also left some buyers questioning whether buying was easier than continuing to rent.
One buyer said their previous rent was $500 a week, while their mortgage would be $800 a week before adding council rates, maintenance and the impact of rate rises.
“Renting felt easier and safer financially – lower costs, less risk, etc. I’m nervous with a mortgage and rate hikes,” they said.
The government, meanwhile, said the scheme has been performing strongly, with 99 per cent of borrowers ahead or on track with repayments and only 13 claims paid since its launch.
It said most people move off the scheme after an average of 2.5 years.
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