Prime Minister Anthony Albanese has made a major election pledge aimed at easing Australia’s housing crisis, announcing a $10 billion plan to build up to 100,000 new homes exclusively for first home buyers. The policy, which will be formally launched during Labor’s campaign event in Perth, is designed to help more Australians – particularly younger voters – access the property market amid soaring home prices and mounting cost-of-living pressures.
A key feature of the initiative includes removing income caps for eligibility under the First Home Guarantee, which currently limits the scheme to singles earning up to $120,000 and couples earning $160,000. The changes would allow all first home buyers to qualify for the government-backed 5% deposit guarantee, eliminating the need for costly lenders mortgage insurance.
“Labor will enable every Australian to buy their first home with a 5% deposit,” the Prime Minister said. “There will be higher property price limits and no caps on places or income.”
The proposal will also lift price caps on eligible properties and scrap the current 50,000-person limit on government guarantees. Labor says this move will drastically cut the time required to save for a deposit and reduce the financial burden of securing a mortgage.
Under current market conditions, the median home price in Australia sits at $820,000. With the new scheme, buyers could secure a property with just $41,000 upfront – or even less, depending on the location. In Sydney, first-time buyers could purchase a $1 million apartment with a $50,000 deposit, backed by a government guarantee.
Housing Minister Clare O’Neil said young Australians have been hardest hit by the housing affordability crisis. “Our government is going to step up to give them a fair go at owning their own home,” she said.
The $10 billion funding pool will be channelled through partnerships with state and territory governments and the private sector. Of that, up to $2 billion will be distributed as grants and the remaining $8 billion will go toward zero-interest loans or equity investments. States and territories will be required to match the federal grants and expedite planning and land release processes.
Construction on the first housing projects is scheduled to begin in 2026–27, with eligible buyers expected to move in from 2027–28. The announcement raises the Albanese government’s total housing investment over its term to $43 billion.
The plan comes as housing affordability and rental stress emerge as top election concerns for Australians under 40. Recent surveys show that many young people feel locked out of the housing market, with homeownership increasingly out of reach.
Labor’s campaign pitch contrasts starkly with the Coalition’s offer of a one-off cost of living tax offset and fuel excise cuts. With the 2025 federal election heating up, housing is shaping up to be a decisive battleground for both major parties.
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