Federal Budget 2025: What It Means for Home Buyers and Property Investors

Thinking of buying your first home or expanding your investment portfolio? The Australian Federal Budget 2025-26 is out and it could shift your property plans.

Handed down by Treasurer Jim Chalmers, with housing high on the priority list, the budget centres around housing affordability, supply shortages, and cost-of-living pressures. A huge question that arises is what is the Federal Budget 2025 affecting, and will it make it easier to own a home? Here’s what you need to know.

Support for First Home Buyers

A major push for the Australian Federal Budget in 2025 was making homeownership more accessible, particularly for first-time buyers.

The Help to Buy equity scheme is seeing a $800 million boost, bringing the total funding to $6.3 billion. This means rather than a 20% deposit, you can buy with just a 2% deposit, with the government chipping in up to 40% of the property price (or 30% for existing properties). This is impactful, considering how the deposit gap is a massive hurdle to home ownership.

Lifting the property price and income caps to $90,000 to $100,000 for individuals and $120,000 to $160,000 for couples and single parents, the scheme is now more accessible.

This could be your fastest route into the market, especially with rising home prices. Just be mindful that while you’ll need less upfront, your loan repayments might be higher. Inovayt’s mortgage brokers in Australia can help you assess whether it’s the right path for you.

$21 Billion for Building More Homes

As Grattan Institute shares, growing wealth inequality and limited housing stock continue to push homeownership further out of reach for many Australians. And just like any other market, the high demand and low supply causes rising prices and scarcity. The 2025 Australian Federal Budget aims to tackle this head-on, with a national target of 1.2 million new, well-located homes to be built over the next five years.

To get there, the government is backing this goal with billions in investment. Nearly 45,000 homes have already been completed in the first quarter of the National Housing Accord, and momentum is building.

A major part of the plan includes:

• $1.5 billion in funding to support state and local governments with planning and infrastructure like roads, power, and water.
• $3 billion in incentive payments through the New Homes Bonus to encourage faster project approvals and reduce supply bottlenecks.
• $54 million to support prefab and modular builds to speed up delivery timelines.
• A focus on unlocking more social and affordable housing, with around 18,000 homes expected through various initiatives, including the Housing Australia Future Fund.
• Supporting the workforce demand with up to $10,000 for housing construction apprentices.

For home buyers, this should help ease some of the pressure around limited stock, especially in high-demand areas. Unsure what areas offer the most value? Review your goals with our homeowner financial guide.

This change also signals strong long-term policy support for residential development to property investors.

Energy Rebates & Cost-of-Living Relief

This budget also offers a much-needed breather on bills.

Every Australian household will receive two $75 rebates directly off their electricity bills through to 31 December 2025. That’s on top of the previous 2024-25 $300 energy bill relief efforts. If you’re renting, there’s also increased rent assistance for eligible tenants, helping ease some of the pressure from rising housing costs.

Tax cuts are still on track for July 2026, aimed at stretching take-home pay and offsetting everyday expenses, including groceries, fuel, and home loan repayments. From 1 July 2026, the tax rate on income between $18,201 and $45,000 will drop from 16% to 15%, followed by another reduction to 14% in July 2027.

For home buyers and property investors, this could make a noticeable difference, whether it’s helping build your deposit or boost your investment buffer.

Good News on Tax Settings for Investors

There are no changes to negative gearing or capital gains tax discounts, giving property investors certainty to plan ahead.

That said, new supply-side funding and bans on foreign buyers purchasing existing homes may shift local market dynamics. If you’re looking for capital growth potential, now’s the time to reassess your investment plan. Keep an eye on location, infrastructure, and demand to spot high-growth suburbs early. Explore our house buying steps for more information.

What It All Means For…

First Home Buyers

This budget is full of opportunity. Between the 2% deposit scheme and tax relief, now might be the best time in years to take the leap.

Property Investors

Stability in tax settings means it’s a good time to reassess your portfolio. With more homes on the way, considering rental demand and local supply shifts for your investments is the right way to go.

Need Help Making Sense of It All?

The 2025 Australian Federal Budget brings both opportunity and complexity, and you want to be ready when the 2025 Federal Budget 2025-26 takes effect. Whether you’re buying your first home or expanding your portfolio, getting the right advice matters.

Get in touch with the Inovayt team to weigh your options and make your property goals a reality.