Regional First Home Buyer Guarantee expansion: What it means for Ballarat renters and buyers

The federal government's expanded Regional First Home Buyer Guarantee took effect this month, opening an additional 10,000 places for regional buyers nationwide. For Ballarat, that means up to 400 eligible residents can now purchase a home with a deposit as low as 5 per cent, without paying lenders mortgage insurance, provided they have lived in the region for at least six months.

The policy, announced in the May federal budget, doubles the previous annual cap of 10,000 regional places. The government says the expansion is designed to address the widening affordability gap between capital cities and regional centres like Ballarat, where the median house price hit $640,000 in May, according to the Real Estate Institute of Victoria.

What Ballarat residents stand to gain

Local mortgage brokers report a surge in inquiries since the scheme opened. The policy targets singles earning up to $125,000 a year and couples earning up to $200,000, meaning a two-income household on average Ballarat wages of $90,000 combined, roughly the local median, would qualify. A buyer purchasing a $550,000 home would need $27,500 saved, rather than $110,000 under a standard 20 per cent deposit.

But the relief comes at a time when rental pressure is intensifying. Ballarat's vacancy rate sits at 1.2 per cent, according to SQM Research, the lowest in regional Victoria. Rents have risen 18 per cent in the past year to a median of $480 per week for houses. Policy analysts note that while the scheme helps buyers on the margin, it does nothing to address the supply side. The federal government's Housing Australia Future Fund, which aims to build 30,000 social and affordable homes nationally over five years, has allocated only 200 of those to the Grampians region, which includes Ballarat.

Local data gaps and next steps

The Productivity Commission's March 2026 review of the scheme found that 65 per cent of previous regional guarantee users would not have been able to buy without the program. But it also found that 15 per cent of regional purchases were made by people who had moved from a capital city, raising concerns about driving up local prices. The review recommended the government extend the residency requirement to 12 months to discourage 'regional hopping'. The government has not adopted that recommendation for this round.

Locally, the Ballarat Regional Housing Working Group, a coalition of community housing providers, council staff and welfare agencies, has called for the state government to fast-track the rezoning of Crown land near the Ballarat West Growth Corridor for medium-density housing. The group estimates the site could support 1,200 new dwellings, 30 per cent of which would be allocated as affordable housing. The state planning minister's office said last week that a decision on the rezoning application is expected by October.

For now, the expanded guarantee is available through 32 participating lenders. The National Housing Finance and Investment Corporation processes applications, with approvals taking up to 30 days. The government says the scheme will be reviewed annually, with the next assessment due in June 2027.