The Pros and Cons of Buying Your First Home in the ACT

From 1 July 2026, the ACT removed both the property value cap and the income threshold for its Home Buyer Concession Scheme.

That change means eligible buyers now receive full conveyance duty exemption regardless of the property price or how much they earn. For someone purchasing in Belconnen, Gungahlin, or inner Canberra, the financial impact is immediate. A property valued at $750,000 would previously have attracted around $27,000 in stamp duty. Under the updated scheme, that cost is zero for a qualifying first home buyer.

The decision you're facing is not just whether to buy, but how to structure your purchase so you can access the schemes available, secure a loan that fits your deposit size, and move forward with confidence. The following sections walk through the practical steps that matter most.

Understanding ACT Stamp Duty Exemptions and How They Apply

The Home Buyer Concession Scheme now provides a full duty exemption for eligible ACT first home buyers with no property value limit. You must be at least 18 years old, have no relevant prior property interest, and occupy the property as your principal place of residence for at least one year starting within 12 months of settlement.

Consider a buyer purchasing an apartment in Braddon valued at $680,000. Under the previous rules that applied before 1 July 2026, they would have needed to meet an income threshold and would have been subject to a property cap. Now, provided they meet the residency and prior ownership requirements, the full duty exemption applies. The same applies to a buyer purchasing a house in Tuggeranong at $820,000. The removal of the value cap opens access to a broader range of properties across Canberra without losing the concession.

If you're purchasing an off-the-plan unit such as a townhouse or apartment, a separate exemption applies with no property value threshold. You must occupy the property as your principal place of residence for at least one year starting within 12 months of completion. This applies to contracts entered into from 1 July 2026 and covers the growing number of developments in areas like Woden Valley and the inner north.

Deposit Size and Loan Structure for ACT Buyers

Most first home buyers in the ACT are working with either a 5% deposit through the Australian Government 5% Deposit Scheme or a 10% deposit with lenders mortgage insurance.

The 5% Deposit Scheme is administered through a panel of 31 participating lenders and does not require you to pay lenders mortgage insurance. Housing Australia guarantees the difference between your deposit and 20% of the property value. There is no income cap and no annual limit on the number of places available. The property price cap for Canberra is $1,500,000, which covers the vast majority of properties in the territory.

In a scenario where a buyer has saved $40,000 and is purchasing a property at $800,000, they can use the 5% Deposit Scheme to cover the deposit requirement without needing to wait until they've saved $160,000. The lender assesses the application in the usual way, but the absence of lenders mortgage insurance reduces upfront costs significantly. At current variable rates, the monthly repayment difference between borrowing $760,000 and $720,000 is material, but the immediate access to the property is often the deciding factor.

If you're saving closer to 10% and prefer not to use the government guarantee, lenders mortgage insurance will apply unless your lender offers an LMI waiver for specific professions or meets other criteria. Some buyers combine a smaller personal deposit with a family guarantee to avoid LMI altogether, and we regularly see this option used in Canberra where parents hold equity in established suburbs like Curtin or Forrest.

Home Loan Application and What Lenders Assess

Lenders assess your borrowing capacity based on your income, existing debts, living expenses, and the deposit you've saved. The assessment uses a buffer above the current interest rate to ensure you can continue to meet repayments if rates rise.

Your application will require proof of income through payslips or tax returns, bank statements showing genuine savings, identification documents, and a contract of sale or property details if you've already found something. Genuine savings are funds you've accumulated over at least three months in your own account. A gift from a family member can be used as part of your deposit, but lenders will typically require a statutory declaration confirming the funds are a gift and not a loan.

Pre-approval gives you a conditional commitment from a lender before you make an offer. It confirms how much you can borrow and shows sellers you're in a position to proceed. Pre-approval is valid for three to six months depending on the lender, and it allows you to move quickly when you find a property in suburbs like Dickson or Campbell where stock can move within days of listing.

In our experience, buyers who begin the loan application process before they start attending open homes are better positioned to act when they find something suitable. Waiting until after you've made an offer often compresses the timeline and limits your ability to compare lenders or negotiate terms.

Choosing Between Fixed and Variable Interest Rates

You can choose a fixed interest rate, a variable interest rate, or split your loan between the two. A fixed rate locks in your repayment amount for a set period, typically one to five years. A variable rate moves with the market and usually offers access to features like an offset account or redraw facility.

Fixed rates provide certainty, which can help with budgeting in the first few years of ownership. Variable rates offer flexibility if you want to make extra repayments without restriction or if you expect your income to increase and want the option to pay down the loan faster. Some buyers split their loan so that half is fixed and half is variable, which provides a middle ground.

Interest rate discounts are negotiated based on the size of your loan, your deposit, and the lender's current settings. A broker can compare rates across the panel of lenders you're eligible for and identify where the most competitive terms are available. That comparison is particularly relevant for ACT buyers using the 5% Deposit Scheme, as not all participating lenders offer the same rate or the same features.

Combining Federal and Territory Schemes

The ACT Home Buyer Concession Scheme can be used alongside the Australian Government 5% Deposit Scheme. The territory exemption removes your stamp duty cost, and the federal scheme reduces your deposit requirement.

Consider a buyer purchasing a unit in Gungahlin at $650,000. They have saved $32,500, which is 5% of the purchase price. They apply through a participating lender under the 5% Deposit Scheme, which removes the need for lenders mortgage insurance. They also qualify for the ACT conveyance duty exemption, which saves them approximately $21,000 in stamp duty. The combination of both schemes reduces their upfront costs by more than $30,000 compared to a buyer who does not qualify for either.

The ACT does not offer a first home owner grant. That grant was replaced by the Home Buyer Concession Scheme in 2019. If you're considering a new build or house and land package, you will not receive a cash grant as you would in other states, but the full stamp duty exemption with no property cap still represents a substantial saving, particularly on higher-value properties.

Help to Buy is available in the ACT and allows the Australian Government to contribute up to 40% of the purchase price for a new home or up to 30% for an existing home in exchange for an equivalent equity share. You need a minimum 2% deposit, and income limits apply: $100,000 for individuals and $160,000 for couples or single parents. Help to Buy cannot be combined with the 5% Deposit Scheme, but it can be used with the ACT stamp duty exemption.

Getting Your Application Ready and Moving Forward

Start by reviewing your savings, checking your credit file, and identifying how much you can comfortably borrow. Use that figure to determine which suburbs and property types are within reach. In the ACT, that might mean looking at apartments in the inner north, townhouses in Belconnen, or established homes in the outer suburbs depending on your budget and lifestyle preferences.

Once you know your budget, gather your financial documents and speak to a broker who can assess your eligibility for the 5% Deposit Scheme, compare loan options, and submit your application to the lender that offers the most suitable terms. The application process typically takes two to four weeks for pre-approval and another two to three weeks for full approval once you have a signed contract.

If you're also accessing voluntary contributions from your super through the First Home Super Saver Scheme, allow time for the Australian Taxation Office to release those funds. Buyers often underestimate how long it takes to coordinate multiple funding sources, and leaving it until the week before settlement creates unnecessary pressure.

The ACT's updated concession scheme has removed two of the biggest barriers for first home buyers: the property value cap and the income threshold. That change, combined with the federal deposit schemes, means more buyers can now enter the market with a smaller deposit and lower upfront costs than at any point in the past five years.

Call one of our team or book an appointment at a time that works for you. We'll walk through your specific situation, confirm which schemes you're eligible for, and get your home loan application underway so you're ready to move when you find the right property.

Frequently Asked Questions