The government has added a regional component to its Home Guarantee Scheme, mirroring an initiative that Labor announced last week, as part of a move to bolster the scheme.

Treasurer Josh Frydenberg yesterday released details of an expanded Home Guarantee Scheme, which will receive funding in the 2022/23 Australian Government Budget.

Under the scheme, eligible home buyers can purchase a home with a deposit of as little as 5 per cent (2 per cent for single parents). The National Housing Finance and Investment Corporation guarantees a scheme lender up to 15 per cent of the value of the property.

The scheme includes the First Home Guarantee, the Family Home Guarantee and the new Regional Home Guarantee, which will start later this year subject to the passage of legislation.

First Home Guarantee. From July 1, the government will provide 35,000 guarantees a year, up from the current allocation of 10,000 a year.

To be eligible for the first home guarantee, individual income cannot exceed A$125,000 and a couple’s income cannot exceed $200,000.

Regional Home Guarantee. Starting on October 1 and running until June 2025, the scheme will support up to 10,000 home buyers a year, including non-first home buyers, to purchase or construct a new home in regional areas. The Regional Home Guarantee replaces the New Home Guarantee.

The regional guarantee will be open to permanent residents as well as Australian citizens (the other guarantees are only open to citizens).

Last week, Labor announced that it would introduce a regional first home buyer support scheme if it wins government, guaranteeing up to 15 per cent of the purchase price for up to 10,000 people a year.

Family Home Guarantee. From July 1 and running until June 2025, 5000 guarantees will be allocated to support single parents trying to buy a home.