What the Major Parties’ First-Home Buyer Policies mean for women – and how falling rates could help
With the federal election on May 3, and speculation the Reserve Bank will cut interest rates on May 20, the home buying landscape in Australia is shifting. For women, particularly those buying property on a single income, returning to work after a career break or balancing saving for a home with other responsibilities, these changes could open new doors, but they come with important fine print.
Both major parties are promising support for first-home buyers, but the impact for women varies. From lower deposit requirements to potential tax deductions, these policies offer new pathways to ownership, but they also come with trade-offs that could influence where you buy, how quickly you act, and how competitive the market may become.
The Coalition’s plan: Mortgage tax deductions for new builds
The Coalition has announced a First Home Buyers Mortgage Deduction Scheme. Under this plan, eligible singles earning up to $175,000 or couples earning up to $250,000 who purchase a newly built home would be able to deduct part of their mortgage interest from their taxable income for the first five years.
The potential savings could be up to $12,000 annually, though this figure would vary based on your income and the size of your mortgage. Importantly, you will only be able to deduct the interest paid on the first $650,000 of the loan, and the property must be a new build to qualify.
This scheme may be more appealing for women with substantial savings already and those with stable, higher incomes who can afford a new build and want to reduce ongoing costs. It won’t help with saving for a deposit or upfront home buying costs. Also, if you’re looking for a home close to work, family, or public transport, where new builds may be less common, this scheme may not fit your needs. Still, the mortgage interest deduction could improve long-term affordability and free up cash flow for other expenses like childcare, renovations, or financial planning.
Labor’s plan: Lower deposits and more homes with price caps and regional limits
Labor has proposed two new reforms. Under the expanded First Home Buyer Guarantee, eligible buyers will be able to purchase a property with just a 5% deposit, with the government guaranteeing up to 15% of the loan value – eliminating the need for Lenders Mortgage Insurance (LMI), potentially saving you tens of thousands of dollars.
Also, under the scheme income limits would be removed, and price caps will be raised, meaning you could purchase a property for up to $1.5 million in cities like Sydney and Newcastle.
Under its second reform, Labor plans to invest $10 billion to build 100,000 new homes for first-home buyers, starting in the 2026–27 financial year. These homes will be priced below current market levels, with the goal of improving long-term affordability and giving more Australians a realistic path to home ownership.
For women who’ve struggled to save a large deposit or who can’t rely on family financial support, buying with just 5% down and avoiding LMI could fast-track their path to ownership. The removal of income limits also means more women, including those in higher-paying roles or dual-income households, can now qualify. Also, the new homes scheme would help improve housing supply.
However, the first scheme will likely lead to increased buying activity. With more buyers entering the market and not enough new homes in the market until at least mid/late 2026, prices could rise even more in the short term.
Are falling rates a timely boost or more competition?
The Reserve Bank’s expected rate cut on May 20 could add further momentum in the market. Lower rates could reduce monthly repayments and slightly increase your borrowing capacity. But they could also bring more buyers into the market, making it harder to find a well-priced property.
The take aways for women
If you’re a woman thinking about buying your first home alone or with a partner, the next year could present some rare opportunities, but it will pay to be strategic. Whether Labor or the Coalition wins, understanding how each policy fits your situation is key. Consider your income, location preferences, timelines, and financial flexibility. And if rates drop (and you are ready to buy) be prepared to move quickly in a potentially more competitive market.
Now could be the time to start planning, get your finances in order, and line up professional advice, because with the right support, you’ll be ready to act when the moment feels right.
Check out the experienced professionals we’re partnering with to help you get the advice you need, at www.urpenny.com.
Disclaimer: The information provided is for general informational purposes only and does not constitute financial advice. You should consider seeking independent financial, legal, or other professional advice to suit your specific circumstances.