Buying your first home in Melbourne is a serious financial undertaking that can feel out of reach, especially with rising property prices and higher living costs.
But if you’re a first home buyer, there’s good news – the state and federal governments offer a range of grants, concessions and schemes designed to help you take that first step onto the property ladder.
If you're considering property ownership in Victoria, understanding the grants and concessions on offer can make the difference between stretching your budget to breaking point and securing a home comfortably within reach.
First Home Owner Grant
Victoria’s First Home Owner Grant (FHOG) is one of the most valuable supports available to eligible buyers in 2025. The grant provides $10,000 towards the purchase or construction of a new home.
The key word here is "new". You'll only qualify if you're buying or building a brand-new property or a substantially renovated home. This means established properties are not eligible for the grant, which can influence your purchasing strategy from the outset.
To qualify for the FHOG, you and your spouse or partner must:
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Be aged 18 or older
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Be an Australian citizen or permanent resident
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Not have owned or lived in a residential property in Australia before 1 July 2000
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Intend to live in the home as your principal place of residence for at least 12 months within 12 months of settlement or completion
The property value must not exceed $750,000.
The FHOG is a once-off payment that goes directly to you. You can choose to put it towards your deposit, pay for legal and conveyancing costs, or reduce your overall loan cost.
Stamp duty concessions
In addition to the FHOG, you may qualify for a stamp duty concession or exemption. Stamp duty, or land transfer duty, is often one of the largest upfront costs when purchasing property. But, if you are buying your first home, you can claim an exemption or concession if you meet certain criteria.
Stamp duty is calculated on the “dutiable value” of the property. This is usually the higher value of either the purchase price or the market value of the property. How much stamp duty you will be required to pay is calculated on a sliding scale – the more expensive the property, the more stamp duty you are required to pay.
First home buyers in Victoria can access a full stamp duty exemption on properties valued up to $600,000. For properties between $600,001 and $750,000, a concessional rate applies, which still delivers substantial savings compared to standard stamp duty rates.
If you are not eligible as a first home buyer below is the amount you will pay for stamp duty on homes bought on or after 1 July 2021:
These concessions apply to both new and established properties, giving you far more flexibility than the FHOG. They may also apply to off-the-plan homes as well as vacant land.
You can access stamp duty concessions and the FHOG, increasing your chances of saving money.
Australian Government 5% Deposit Scheme
Previously known as the First Home Buyers Guarantee (FHBG), the 5% Deposit Scheme helps you by removing the hurdle of saving a 20% deposit.
Typically, you are required to have 20% of the value of the property saved as a deposit when you take out a home loan without having to pay lenders mortgage insurance (LMI). This is an insurance that protects the lender in case you default on your mortgage repayments and it can add up to thousands of dollars in addition to your other expenses.
Under the 5% Deposit Scheme, the government will guarantee up to 15% of the value of your property so that you can buy a home with as little as 5% deposit and avoid paying LMI.
In October 2025, the federal government expanded the scheme. It removed limits on the number of places available in the scheme as well as income caps so that all first home buyers become eligible. It also increased the property price caps to include more properties. In Melbourne, the cap is now $950,000. In the rest of Victoria, the cap has increased to $650,000.
According to Cotality, the median dwelling value in the city reached $805,880 in September 2025, which means a much larger share of homes now fall within the eligible range, giving first home buyers greater choice and access to more suburbs across Melbourne.
Additional support for regional buyers
If you’re interested in a property in regional Victoria, you may see more benefits. The property price cap for the 5% Deposit Scheme is much lower at $650,000, allowing you to buy a more affordable home with only 5% deposit.
Additionally, regional stamp duty concessions also tend to be more generous given the lower property values, meaning your purchasing power extends further. With remote work becoming increasingly viable for professional services roles, regional Victoria could work for you if you're willing to commute occasionally or work primarily from home.
Off-the-plan stamp duty concessions in Victoria
In Victoria, there is a significant off-the-plan stamp duty concession currently available, extended until October 2026. This concession allows all buyers (not just first home buyers) of off-the-plan apartments, townhouses and units to reduce the amount of stamp duty payable by deducting the outstanding construction or refurbishment costs from the contract price when calculating the dutiable value.
In effect, buyers pay duty only on the land value and completed works at the time of purchase, not on the total contract amount – a substantial saving that can make off-the-plan properties more affordable.
The concession applies to land and building packages, vertical developments (such as apartment towers), horizontal developments (like townhouse complexes) and refurbished residential projects. Unlike other incentives, it applies regardless of property value, as the previous price caps have been removed. All purchasers, including investors and even foreign buyers, may qualify, although certain company or trust structures may not be eligible. For example, if you purchase an off-the-plan apartment for $620,000 and $465,000 of that relates to future construction costs, stamp duty would only be calculated on $155,000, not the full amount.
What qualifies as off-the-plan in Victoria?
To be eligible, the contract must be signed before construction or refurbishment costs are incurred for the full benefit to apply. “Off-the-plan” refers to buying a property before construction starts or is completed, including both new developments and substantial refurbishments as part of a subdivision. Eligible properties are generally residential dwellings, such as apartments, townhouses and units.
While some earlier concessions were limited to owner-occupiers, the extended scheme now applies more broadly, meaning investors can also benefit. Buyers must still meet standard criteria such as being at least 18 years old and purchasing a property intended for residential use. Overall, the off-the-plan concession offers significant upfront savings and remains one of Victoria’s most generous incentives for both homebuyers and investors – but only until October 2026 (unless extended).
How to combine grants with home loans
The good news is that most of these programs can be combined. For instance, you could:
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Use the FHOG for your deposit
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Apply the stamp duty exemption to reduce upfront costs
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Use the 5% Deposit Scheme to secure a loan with only a 5% deposit and no LMI
Together, these incentives could reduce your total out-of-pocket costs by tens of thousands of dollars, depending on your property value and location.
To make these calculations even easier, AXTON Finance offers our Next Purchase property planning software. This exclusive tool helps you see exactly how your deposit, loan, stamp duty and ongoing costs will affect your cash flow, allowing you to model different scenarios before you commit. It’s ideal for first home buyers, upsizers or investors who want a clear picture of how each decision impacts their finances.
With this clarity in hand, a knowledgeable mortgage broker at AXTON Finance can guide you through the application process for grants, concessions and low-deposit loans. We ensure your loan structure works alongside the incentives you’re eligible for, so your first home purchase is as smooth and cost-effective as possible.
How to apply
Each program has its own application process and requires attention to detail.
Start by confirming eligibility for the FHOG, stamp duty relief and the 5% Deposit Scheme. The rules around previous property ownership, including that of a spouse or partner, are strict.
Not all banks and lenders offer the 5% Deposit Scheme, so it will help to work with a broker who knows the scheme's participating lenders to ensure your application goes to a suitable institution.
Applications for grants and concessions must be lodged with specific documents at the correct time. This can be at settlement or alongside the home loan application, depending on the grant or incentive.
Missing a detail or submitting an incomplete application can mean delays - or missing out entirely if places fill before you resubmit.
How AXTON Finance can help
At AXTON Finance, we specialise in helping Melbourne buyers secure competitive finance while maximising every available government benefit. Our brokers understand the fine print behind each scheme and work directly with participating lenders to streamline your application.
Most importantly, we handle the paperwork, chase the approvals and coordinate with your conveyancer so nothing falls through the cracks. With the Next Purchase software, we can also model your cash flow, loan-to-value ratios and total costs for your new home, giving you a full financial picture before you commit.
Government incentives can change from year to year - and navigating them takes time. Working with a trusted mortgage broker ensures you don’t miss out on opportunities to save.
Thinking about buying your first home? AXTON Finance can help you understand which government grants and schemes you qualify for, secure a competitive loan and make your purchase as seamless as possible. Call 03 9939 7576, email getabetterrate@axtonfinance.com.au or get in touch today.