The First Home Loan Deposit Scheme (FHLDS), launched by the government on January 1 2020, can help eligible first home buyers secure a home loan with a deposit as little as 5% by guaranteeing up to 15% the value of the home, meaning they don’t have to pay the oft-dreaded Lenders Mortgage Insurance (LMI).

The scheme is limited to 10,000 loans per year, from a total of 27 lenders.

According to Commonwealth Bank, 1,000 of those spots  - aka one-tenth - have been filled by its customers, with another 2,400 securing a spot for future purchases. 

According to CBA, those 2,400 customers who’ve reserved a spot under the scheme can now have an extra 90 days to extend the deadline to find a property and enter a contract of sale, giving them six months in total. 

“There is a lot of interest and uncertainty about the impact the coronavirus will have on the Australian property market so it’s encouraging that we have crossed this exciting milestone in the current environment,” CBA Group Executive Retail Banking Services Angus Sullivan said. 

“Whether you are purchasing your first home or looking to buy a new home we want to reassure customers that we are open for business and here to help them realise their home ownership goals. 

“We also realise that some customers are looking for support during this difficult period and we have a range of measures to assist them including deferring repayments and reducing repayments to free up cash.”

Buying a home or looking to refinance? The table below features home loans with some of the lowest variable interest rates on the market for owner-occupiers.

Update resultsUpdate
LenderHome LoanInterest Rate Comparison Rate* Monthly Repayment Repayment type Rate Type Offset Redraw Ongoing Fees Upfront Fees LVR Lump Sum Repayment Additional Repayments Split Loan Option TagsFeaturesLinkCompare
6.04% p.a.
6.06% p.a.
Principal & Interest
Featured Online ExclusiveUp To $4K Cashback
  • Immediate cashback upon settlement
  • $2,000 for loans up to $700,000
  • $4,000 for loans over $700,000
5.99% p.a.
5.90% p.a.
Principal & Interest
Featured Apply In Minutes
  • No application or ongoing fees. Annual rate discount
  • Unlimited redraws & additional repayments. LVR <80%
  • A low-rate variable home loan from a 100% online lender. Backed by the Commonwealth Bank.
Important Information and Comparison Rate Warning

Base criteria of: a $400,000 loan amount, variable, fixed, principal and interest (P&I) home loans with an LVR (loan-to-value) ratio of at least 80%. However, the ‘Compare Home Loans’ table allows for calculations to be made on variables as selected and input by the user. Some products will be marked as promoted, featured or sponsored and may appear prominently in the tables regardless of their attributes. All products will list the LVR with the product and rate which are clearly published on the product provider’s website. Monthly repayments, once the base criteria are altered by the user, will be based on the selected products’ advertised rates and determined by the loan amount, repayment type, loan term and LVR as input by the user/you. *The Comparison rate is based on a $150,000 loan over 25 years. Warning: this comparison rate is true only for this example and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate. Rates correct as of . View disclaimer.

According to the latest figures released by Federal Minister for Housing Michael Sukkar, 4,147 spots in total have been filled in the FHLDS among the 27 lenders, and a further 1,944 are on hold waiting for the purchase of a property. 

That leaves only 1,944 spots still available, potentially even less as some are still being processed.  

Among the different states:

  • 1,397 certificates have been issued in NSW 
  • 1,119 have been issued in Queensland 
  • 951 have been issued in Victoria 

Read: The complete guide to the First Home Loan Deposit Scheme

House prices could fall by 30%

First home buyers looking to access the scheme might be considering waiting a little while before jumping into the property market, as property prices are expected to plunge, primarily thanks to COVID-19. 

NAB research outlines two scenarios that would affect the amount of defaults across its loan products.

The first is a “severe downside scenario” with a U-shaped recovery in the economy, which would see house prices fall 20.9% in 2020, 11.8% in 2021 and marginally rebound by 2.5% in 2022.

The softer, “V-shaped recovery scenario” would see house prices fall by 10% in 2020 and rebound by 2.6% in 2021.

This data is supported by a similar study by Data house SQM Research, which said a 30% decline in dwelling prices by the end of 2020 is “entirely possible” in a worst-case scenario. 

Prospective first home buyers can submit applications directly through the participating lender of their choice.

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