How We Helped a Sydney First-Home Buyer Escape the Rent Trap with the Help to Buy Scheme

An hfinance client case study 

For one Sydney renter, the maths of home ownership simply didn’t add up — until the Federal Government’s Help to Buy Scheme, a family gift, and the right loan structure came together. Here’s how HFinance helped a first-home buyer purchase a $750,000 home, stop renting, and end up paying less each month than they were paying their landlord. 

The Challenge: Stuck in the Rent Trap 

Our client’s situation will sound familiar to thousands of Sydneysiders. They were paying $2,000 a month in rent, had a modest savings balance, and — despite a stable income — could not see a realistic path to a deposit. 

The numbers explain why. Sydney’s median house price is $1,617,000 as of January 2026 (units $871,000), per the PropTrack Home Price Index, with dwelling values up 5.7% over the year. And it takes longer to save a deposit in Sydney than in any other capital: Domain’s 2026 First Home Buyers Report finds it takes 7 years and 7 months to save a 20% deposit on an entry-level Sydney house — the only capital city where entry-level houses now cost seven figures (around $1.15 million). 

At the same time, the rental market offers no relief. Sydney’s rental vacancy rate was just 1.3% in April 2026 according to SQM Research, and rents have surged to record levels. Domain’s 2026 forecast points to record median asking rents around $815 a week for houses, and its First Home Buyers Report shows repayments or rents on an entry-level Sydney home now consume about 68% of household income — the highest of any capital. 

This is the “rent trap”: every dollar of rent paid is a dollar that can’t be saved toward a deposit, while property prices and rents keep climbing faster than savings can grow. Our client was working hard and doing everything right, but the deposit hurdle kept moving further away. 

The Solution: Help to Buy + a Family Gift 

When our client came to HFinance, Director Jeremy Harper looked at the full picture — income, savings, family support and eligibility — and identified a structure that changed everything: the Australian Government’s Help to Buy Scheme, combined with a deposit gift from family. 

Help to Buy is a shared-equity scheme administered by Housing Australia. It launched on 5 December 2025 and is designed to bridge the gap between what a buyer can borrow and the price of a suitable home. The mechanics are straightforward: 

• The buyer needs a deposit of as little as 2%. 

• The Government contributes up to 30% of the purchase price for an existing home (up to 40% for a new build). 

• Because the Government’s equity contribution brings the effective loan-to-value ratio below 80%, there is no Lenders Mortgage Insurance (LMI) to pay. 

• The buyer owns and lives in the home. They pay no rent on the Government’s share. 

• The Government’s share is repaid when the home is sold, or the buyer can buy it back over time through voluntary repayments or refinancing — always based on the property’s value at the time of repayment. 

For a buyer with strong family backing but a mortgage-servicing constraint, Help to Buy was the ideal fit. It let our client keep their loan small and their repayments manageable, while a generous family gift covered the bulk of the upfront cost. 

How the Deal Was Structured 

Working with Bank Australia — a participating Help to Buy lender that accepts applications through mortgage brokers — Jeremy structured the $750,000 purchase as follows: 

A few things make this structure work so well: 

• The Government’s 30% contribution ($225,000) is the maximum for an existing home and does the heavy lifting on affordability. 

• The family gift ($285,000) was documented with a gift letter confirming the funds were unconditional and non-repayable — a standard requirement HFinance manages as part of the application. 

• The loan is just $240,000 — around a third of the purchase price — which keeps monthly repayments low and leaves the client with genuine financial breathing room. 

No closing costs, thanks to the stamp duty exemption 

Because our client is a first-home buyer purchasing an existing home under $800,000, they qualified for a full transfer (stamp) duty exemption under the NSW First Home Buyers Assistance Scheme (FHBAS). A standard NSW owner-occupier would pay approximately $27,937 in transfer duty on a $750,000 property under the Revenue NSW sliding scale. Because first-home buyers are fully exempt up to $800,000 under the FHBAS, our client paid $0 — effectively wiping out what is usually the single largest closing cost. Combined with no LMI under Help to Buy, the purchase settled with no closing costs standing in the way. 

The Numbers: Cheaper Than Rent 

This is where the story really lands. Our client’s new loan is $240,000 over 30 years at 6.18%. 

The monthly principal-and-interest repayment on that loan is approximately $1,464 a month. 

Compare that to what they were paying before: 

Our client is now paying around $536 less every month than they were in rent — roughly $6,400 a year back in their pocket. But the more important shift is what those dollars now do. Rent was money gone forever. Every mortgage repayment now builds equity in a home they own. They’ve gone from paying down someone else’s asset to paying down their own. 

What This Means for the Client 

The outcome is more than a lower monthly number. Our client has: 

• Escaped the rent trap — no more rising rents, no more lease uncertainty, no more competing at inspections. 

• Financial security — a modest, predictable mortgage repayment that sits comfortably below their previous rent. 

• A foundation to build on — equity that grows with every repayment and with any increase in the home’s value (shared proportionally with the Government). 

• Space to focus on family — with housing settled and money freed up each month, they can plan ahead with confidence. 

That last point matters most. This wasn’t just a transaction; it was the difference between feeling stuck and feeling settled. 

Is This Right for You? 

Help to Buy won’t suit everyone, but for the right buyer it can be transformational. To be eligible, you generally need to: 

• Be an Australian citizen aged 18 or over. 

• Be an owner-occupier — you must live in the home, and investment properties are not eligible. 

• Not currently own property in Australia or overseas. 

• Have a taxable income at or below the thresholds. From 1 July 2026, Housing Australia confirmed these rose to $103,000 for single applicants and $165,000 for joint applicants and single parents (up from $100,000 and $160,000). 

• Buy a home at or below the price cap for your area — the Sydney and NSW capital-city/regional-centre cap is $1,300,000. 

• Have a minimum 2% deposit and borrow the balance from a participating lender. 

Places are limited to 10,000 per year, and you can still combine Help to Buy with NSW state benefits such as the FHBAS stamp duty exemption. You cannot combine it with the Government’s separate 5% Deposit Scheme. 

Every situation is different, and the right structure depends on your income, savings, family support and goals. That’s exactly what a mortgage broker is for — working out which scheme (or combination of schemes) gets you into your home sooner, and structuring the deal so it works for your life, not just on paper. 

This article is general information only and does not constitute credit or financial advice. It does not take into account your objectives, financial situation or needs. Scheme rules, income and price caps, lender criteria and interest rates are subject to change — always confirm current details with Housing Australia, Revenue NSW and your lender. Repayment figures are illustrative and based on the assumptions stated. Jeremy Harper is a Credit Representative (CRN 463430) of Mortgage Specialists Pty Ltd, Australian Credit Licence 387025.