Single parents buying their first home may soon be able to with a deposit of only two per cent under a new federal scheme.
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The program allows first home buyers to obtain a loan for a new or newly-built home with a deposit of as little as two per cent with the government guaranteeing up to 18 per cent of the loan.
Under the measure announced ahead of Tuesday's federal budget, up to 10,000 first-time buyers with dependants will be able to access the scheme over four years.
Minster for Women's Economic Security Jane Hume says the aim is to make the "great Australian dream" accessible for single mothers.
"We know that so many single parents use so much of their income towards rent and building that deposit is so much harder for them with the demands of children," she said.
"So this is all about removing those barriers to building that deposit and it's also about giving those a hand up who need it the most."
The government has also extended its similar First Home Loan Deposit Scheme to an additional 10,000 buyers.
That scheme allows first-time buyers to build or purchase new homes with a deposit as small as five per cent.
Both measures are designed to fuel construction and boost property ownership, building on the government's HomeBuilder program, which provided grants of $25,000 for new homes and major renovations.
"The government understands the importance of owning your own home and the significant economic and social benefits home ownership provides," Treasurer Josh Frydenberg said.
However Labor spokesman Jason Clare said it was too little too late.
"This government has had eight years to fix housing affordability and it's just got worse," he told reporters in Sydney.
"What the government's announced today is not enough to fix this."
Mr Clare renewed calls to scrap the cap on the number of people able to benefit from the scheme.
More than 100,000 Australians buy a home for the first time every year and the scheme at best helps only 20,000 of them, he said.
Australian Council of Social Services chief executive Dr Cassandra Goldie called it a "cheap as chips" measure that will have no impact on struggling single parents.
There has to be more in the budget to help the one in three single parents living in poverty, she said.
"The question will be: is this it?"
"It'll help a handful ... (but) we are still leaving hundreds of thousands of the lowest income, single parents absolutely behind."
However the Commonwealth and NAB banks and peak housing industry associations are all fans.
"The new Family Home Guarantee will be a revolution in providing single custodial parents, the overwhelming majority of whom are women, with a step up to gaining the security that comes with home ownership," Master Builders Australia chief executive Denita Wawn said.
In Sydney and NSW regional centres, the schemes are capped at homes worth $950,000, while the rest of the state has a limit of $600,000.
The cap for Melbourne and Victorian regional cities is $850,000 and elsewhere in the state, $550,000.
In Brisbane and Queensland regional centres it is $650,000 falling to $400,000 in country areas.
WA, SA, Tasmania and the NT have state-wide caps of $550,000, while the ACT limit is for dwellings worth $600,000.
More than half the first-home buyers who have accessed the scheme are under 30, while 15 per cent of the guarantees went to people over 40.
Around 85 per cent of people bought a house, with 10 per cent purchasing a unit or apartment and four per cent buying townhouses.
The average annual income for applicants is $70,000 for singles and $115,000 for couples.
The government is also increasing the amount in voluntary superannuation contributions that can be released to buy a first home from $30,000 to $50,000 and providing $124.7 million in extra state funding to bolster public housing stocks.
Australian Associated Press
