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You can find out more information about the Victorian Homebuyer Fund by reading the following frequently asked questions. If you have applied for the Homebuyer Fund and have questions relating to your home loan application, please contact your lender directly.

Before you apply

What is shared equity in the context of the Victorian Homebuyer Fund?

Shared equity is an agreement in which the Victorian Government makes a financial contribution towards the purchase of your property (up to 25%) in exchange for a proportional interest (share) in your property.

As the value of your property changes, so too will the value of the Government’s interest (share) in the property. This means the Government will share in any capital gains proportionate to its interest in the property.

Read case studies about how the Homebuyer Fund works.

How many places are available?

The $500 million Homebuyer Fund will over time, help up to 3000 households own their own homes.

What additional assistance is available to Aboriginal and Torres Strait Islanders?

Eligible Aboriginal and Torres Strait Islander applicants can access a contribution of up to 35% of their property price. You also may qualify for a minimum required deposit of 3.5%, depending on your participating bank’s lending criteria and your personal circumstances.

I’m an Aboriginal or a Torres Strait Islander. Do I need to confirm this in my application and if so, how is that done?

All aspects of an application are assessed including your eligibility as an Aboriginal or Torres Strait Islander. Aboriginal Housing Victoria will work with you to provide the supporting information you need to progress your application.

How do you apply for the Homebuyer Fund?

You should first check if you may be eligible via our online tool. If you meet the eligibility criteria from the tool, you will receive an email explaining the next steps.

How are banks involved?

Bank Australia and Bendigo Bank are the current participating lenders delivering the Homebuyer Fund. Once you have checked your eligibility, which is just a guide, you should get in touch with your chosen participating lender to conduct standard loan assessments and evaluate if you are able to service a mortgage. It is important to understand that while you may be eligible for the Homebuyer Fund, you may not necessarily be eligible for a loan with a lender.

Can I use another bank?

No. Your loan must be provided by a participating lender, either Bank Australia or Bendigo Bank.

I have saved a 5% deposit, are there any other costs involved?

Yes. You are also required to pay all costs associated with purchasing your home (often known as acquisition costs) such as conveyancing, legal costs, building inspections and stamp duty (if applicable). You may be eligible for stamp duty concessions and the First Home Owner Grant (FHOG) to assist with these costs.

Can my deposit be more than 5%?

Yes. The required minimum deposit for most applicants is 5%; or 3.5% for Aboriginal and Torres Strait Islander applicants. The deposit must be from your genuine savings.

How long do I need to have saved my deposit for?

Demonstrating genuine savings varies between financial institutions. Check with your chosen participating lender for their requirements.

Is interest charged on the Victorian Government’s financial contribution?

No. A contribution from the Homebuyer Fund does not attract interest, however, as the value of your home changes, so too will the value of the Government’s share (or proportional interest). Because you are buying back some or all of the Government’s share in your property, repayments of the Homebuyer Fund contribution will reflect any capital gains of your home.

Can I apply if I am on a probation period with an employer?

All applicants must secure in-principle loan approval from their chosen participating lender. Lenders may have different requirements about employees who are on probation. Check with your lender for their requirements.

Are there restrictions on where I can purchase a property?

Yes. Your property must be in eligible locations in Metropolitan Melbourne or Geelong, or in another eligible regional location. View the full list of eligible locations.

Can I buy an established home?


Can I buy a new home?

Yes, provided a certificate of occupancy has been issued at the date of signing a contract of sale.

Can I still receive the First Home Owner Grant (FHOG)?

Yes. The Homebuyer Fund does not impact your eligibility for the First Home Owner Grant (FHOG). If you are eligible for the FHOG, you will be able to apply in the usual way. 

Will I need to pay stamp duty?

You will be required to pay the usual amount of stamp duty that applies at the time of settlement for the full cost of your property. Find out more about stamp duty.

Will I need to pay land tax?

No. To be eligible for the Homebuyer Fund, the property you buy must become your principal place of residence. Based on current policy settings, a property that is occupied by its owners as their principal place of residence is exempt from land tax.

What happens if I want to sell my property?

You must notify us and your lender at least 45 days prior to sale. You are required to sell your property via an independent process, such as through a real estate agent. You will be required to meet the full costs of selling your property, including any upfront costs.

Is there a minimum period the property must be held for before it can be sold?

You are not permitted to sell your property within two years of settlement without the prior written consent of the SRO.

Has a program like this been used anywhere else in Australia?

The Homebuyer Fund was preceded by HomesVic, the Victorian Government’s shared equity pilot, which helped several hundred Victorians into their first homes. Shared equity programs have also been operating in several other states, including South Australia (HomeStart), Tasmania (HomeShare) and Western Australia (KeyStart).

I’m an existing homeowner in the HomesVic pilot scheme. Can I swap schemes now and join the Victorian Homebuyer Fund?

Not right now and there is no action required but we will give you the opportunity to be part of the Homebuyer Fund by March 2022. State Trustees (the administrator of HomesVic) will be in touch with you by December 2021 to formally ask for your consent to provide us (the administrator of the Homebuyer Fund) with your details. If you say yes, we will be in touch with you shortly afterward to offer you the opportunity to migrate from HomesVic to the Homebuyer Fund. It’s your choice which scheme you’d like to be part of.

Once you have applied

Can I buy a property above my indicative maximum purchase price?

Possibly. Before making an offer on a property, you should contact your chosen lender to seek an increase of your pre-approved loan. If approved, your lender will submit a new application on your behalf, which may result in a new provisional approval with a different shared equity contribution and indicative maximum purchase price.

Alternatively, if you have already made an offer on a property above your indicative maximum purchase price, you may still be eligible for the Homebuyer Fund, provided you can increase your deposit or loan amount, and the price is below the relevant property purchase price threshold for the Fund.

What type of insurance do I need to take out on the property?

Your property must be insured against damage, destruction (including by fire, storm and tempest) and any other risk required by your chosen lender to its full replacement value, or on a reinstatement basis. The insurance policy must be taken out with an authorised insurer and must note the participation in the Homebuyer Fund.

How long does it take for provisional approval to be granted?

You will be notified within approximately 48 hours of completing a home loan application and completing and submitting a Homebuyer Fund application form.

I’ve been granted provisional approval. What happens next?

You will receive a letter detailing your indicative maximum purchase price (based on your deposit and in-principle loan approval amount) and the maximum financial contribution you may be eligible to receive from the Government, pending the satisfaction of certain conditions.

You will have six months to enter into a contract of sale for an eligible property.

Before buying a property, you will need to watch a short video about the Homebuyer Fund (a link will be provided) and you will need to negotiate with the vendor's real estate agent the provision of a 5% deposit on entering into a contract of sale to purchase the property. If the vendor does not accept a 5% deposit, you will need to contact us on (03) 7020 1549.

What happens if the purchase price of my property exceeds the relevant price threshold for that location?

You will lose eligibility to the Homebuyer Fund which means the State will not be able to make a financial contribution to the purchase of your home.

What happens after I sign a contract of sale?

You will need to pay the deposit at the time of entering into the contract of sale. You will also need to let your lender and us know you have made a purchase so preparations for settlement can be made.

Within five business days you will need to provide a copy of the signed contract of sale to your lender, as well as returning the signed Participation Agreement and the Program Mortgage to us.

What is the process once I receive final approval?

You will receive a letter outlining what you need to do before settlement.

Are there any restrictions on the sale methods when buying a property?

No. Any standard sales methodology that is accepted within the real estate industry can be used.

What is a related person?

A person or entity who is related to, or associated with you including:

  • Relatives by birth or marriage (including parents, grandparents, siblings, uncles, aunts, nephews, nieces, lineal descendants or adopted children of your or your spouse, and the spouse or civil partner of any of those people).
  • Business partners.
  • Spouses, civil partners or children of such business partners.
  • Any company you (or any person listed above) controls or can influence.
  • The trustees of any trust controlled by a you (or any person listed above) or of which you are a beneficiary or member.

To be eligible to participate in the Homebuyer Fund, you must not purchase your property from a vendor who is a related person.

What happens if I am unable to enter into a contract of sale within six months?

If you are unable to enter into a contract of sale by the end of the six-month period, your provisional may be cancelled. In making this decision, we will consider any exceptional circumstances that may have affected your ability to enter into a contract of sale within the allotted time. If exceptional circumstances exist, an extension may be granted.

If you are having trouble entering into a contract of sale within the allotted time period, you should contact us on (03) 7020 1549.

I would like to repay some of the Government’s financial contribution. How is the value of the financial contribution determined at that time?

We will commission a valuation of the property from the Valuer-General Victoria at the time you would like to repay some or all of the Government’s financial contribution. Generally, this valuation will be used to calculate the value of the Government’s share in the property. View our case studies for more information.

When am I required to repay the Government’s financial contribution?

You will be required to repay the Government’s financial contribution within the initial duration of the home loan with your lender (plus six months), or two years from repayment of the home loan if the home loan is paid off early.

You may be required to pay the financial contribution early if you breach the terms and conditions of the Participation Agreement or Program Mortgage.

How do I exit the Victorian Homebuyer Fund?

Before entering into a contract of sale, you can withdraw your application at any time by notifying us in writing.

Once a contract of sale is entered into (and subject to any cooling off period and/or all conditions of the contract of sale, if conditional, being met), you are required to hold the property as your principal place of residence for at least two years, unless exceptional circumstances occur.

After this time, you can exit the program by either selling your property or repaying the Government’s financial contribution. The latter can be done in a range of ways including by refinancing your home loan (pending approval from your lender), or through voluntary payments.

Can I make a voluntary payment and what is the process?

Yes. Your payment will need to reduce the Government’s interest by at least 5 percentage points i.e. from 25% to 20%, and be at least $10,000. A valuation will be conducted on your property by the Valuer-General Victoria to determine its current market value. Once the valuation is complete, we will advise you of the payment details and once the payment has been made, you will be notified of the resulting change in the shared equity interest in your property. You may not, however, repay the entire Government’s share within two years of your settlement date without prior written consent from the Homebuyer Fund team.

Who decides how much my property is worth?

The Valuer-General Victoria. It is the Victorian Government's authority on statutory valuations. The Valuer-General oversees valuations for Victorian Government property transactions and rating valuations and will be used to determine your property’s value.

How are proceeds from the sale of your property treated?

The Government’s financial contribution in your property is secured through a second-ranking mortgage, second to your lender’s mortgage. If you sell your property, proceeds will be applied in the following order to:

  • Your lender to repay your outstanding loan amount and any other outstanding amounts.
  • Homebuyer to repay the Government’s financial contribution and any other outstanding amounts.
  • Anyone else with a legal or equitable interest in your property.
  • You.

Can I refinance my loan?

Yes. You can refinance your home loan, subject to the approval of your chosen participating lender. However, you can only increase your borrowings in limited circumstances, such as paying back the Government’s share, or as otherwise permitted by the hardship provisions contained in the Consumer Credit Legislation. This must be approved by the Homebuyer Fund team.

What happens if I lose my job or suffer financial hardship?

You should notify us and your lender immediately to discuss your options, noting that you are afforded certain protections under the National Credit Code.

What happens if a single applicant subsequently marries or enters into a defacto relationship?

Your ongoing eligibility for the Homebuyer Fund will not change, unless your new partner also becomes a registered owner of the property, which also makes them a participant with you in the Homebuyer Fund. If this occurs, you will now be assessed as a multiple person household based on your combined income. If your combined income is within the income threshold for a multiple person household, there will be no change in the requirements, other than reporting obligations.

If your combined income exceeds the income threshold for a multiple person household, you will be provided a two-year grace period before you will need to demonstrate your attempts to pay all or part of the Government’s financial contribution, as your circumstances permit.

What happens if your income increases over time and exceeds the income threshold?

If your income exceeds the gross annual income threshold for two consecutive years, you will be required to repay the Government’s financial contribution in part or whole as your circumstances permit. You will need to advise us of your increased income levels and work with your lender to determine the extent to which you can refinance to repay the Government’s financial contribution in part or whole.

Can I vacate the property?

The property must be your principal place of residence. Unless we approve, you cannot vacate the property for more than three months. Generally, there must be exceptional and unavoidable circumstances to obtain approval for vacating (e.g. caring responsibilities on medical grounds). If we agree, time limits may be imposed.

Can I lease the property?

You may lease part of your property (e.g. a room) provided the property remains your principal place of residence (you continue to live in it) and you adhere to all reporting and other requirements.

If we determine that your property is no longer your principal place of residence, we may request you to pay the Government’s financial contribution within six months.

Will I need a conveyancer/lawyer?

Yes. You must engage a lawyer or conveyancer for settlement of the property.

Can the property be renovated?

Generally, yes. However, you will need our approval if you are making modifications that:

  • Cost $10,000 or more.
  • Require a building or planning permit.
  • Involve a structural adjustment to the property.

Modifications that reduce the value of the property are not be permitted. In addition, your equity share must not fall below that initially held at the time of purchasing the property as a result of the modifications.

The impact of the proposed modifications on the value of the property will be determined by the Office of the Valuer-General Victoria. Participants will not be required to pay back any increase in the property’s value achieved through approved renovations.

Last modified: 8 October 2021
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