House of Cards

The genetics lottery used to be about health and appearance, now it seems as if homeownership is part of the draw. The prospect of becoming a homeowner is starting to feel more tied to heredity than effort.

In the same way a medical practitioner queries about family illness, maybe mortgage lenders could start asking whether homeownership runs in the family.

The Australian dream was once underpinned by the core values of hard work and a determined spirit. If you had this and a decent paying job then you were on track to secure your own patch of grass. In 2025, the climate is volatile and fragile with the odds stacked up against you like a house of cards.

In the early 2000s, the cost of a home was about three to four times the median income. Today, it’s approximately nine times the median income, and in Sydney, it’s closer to 10 times the median income.

With an eye watering housing to income ratio of 9.8, Sydney takes the crown as the least affordable housing market in the country. For the average buyer, that means 13 years of saving just to scrape together a deposit.

Thinking of renting instead to escape the pressure? That’s no easy path either. Households in Sydney are spending an average of 33.3% of their income on rent with many paying far more. This places a large portion of the population under rental stress, which is generally defined as spending 30% or more of your income on rent.

But you don’t need a report to tell you that. You’re more than likely experiencing this first hand.

Granted not everyone has homeownership on their vision board. Some prefer to rent, allowing them to have more flexibility to live a transient lifestyle, or even just to tick the box of a living in the Bondi bubble before settling down.

The key difference is choice.

The options available to many Australian’s have significantly dwindled, forcing many to play into the hands of landlords and lenders.

When the impact of the cost of living starts to shape how we live, we adapt to match the rate of inflation. Choosing to meal prep over dining out, exploring the outback instead of jet setting overseas, and finessing our DIY skills just enough to keep the home projects from becoming an OH&S issue.

When it comes to housing, the alternative to extortionate rent or a lifelong deal of debt is homelessness.

When you rent in an area you’ve always dreamed of living in, you do it knowing you’re at the whim of your agent, auditioning every 12 months and hoping your renewed lease doesn’t come with a hefty rent hike.

A lot can happen in the space of a year, for those really committed to testing the limits of the cost of living crisis a person could conceive and give birth during a year long lease. But with daycares and many schools being harder to access than the Qantas Chairman’s Lounge, it’s not hard to imagine why Sydney is losing around 7,000 millennials a year, many fleeing interstate in an attempt to secure a sense of stability when it comes to their home.

In 2024, the NSW Productivity Commission released a housing report, ‘What we gain by building homes in the right places, which laid bare the toll of the housing crisis. Between 2016 and 2021, Sydney lost twice as many people aged 30 to 40 as it gained, while 35,000 moved in, 70,000 packed up and left.

The rental laws in NSW changed earlier this year, including an end to ‘no grounds’ evictions and a limit on rent increases to once a year. But when housing is uncertain, so is everything else. Building a life, a future, or a sense of belonging feels entirely out of reach.

For those choosing to stay in NSW, the only thing more daunting than navigating the housing market and reckoning with the cost of homeownership, is figuring out what support actually exists to help you get a foot in the door.

Each level of government has a role to play in shaping housing policy and providing support. While State and Territory Governments receive funding for housing from the Commonwealth, they also implement their own initiatives to provide additional support to residents.

With the odds stacked against first-home buyers, any support helps. Here’s a rundown of what someone in Sydney might be able to access when buying an existing home.

First Home Super Saver Scheme (FHSS) – Commonwealth Program

Navigating your superannuation is tricky at the best of times, but it can be used as a tool to help you enter the housing market. The First Home Super Saver Scheme is an initiative driven by the Commonwealth Government that allows you to make personal voluntary contributions into your super fund to help you save for your first home.

It’s basically a side pocket in your super account that you have to fill yourself which can later be withdrawn to help form a deposit for a home you intend to live in. The scheme lets you save up to $50,000 for your first home by making voluntary contributions into your super fund.

Key word: voluntary.

This is not a rebranded version of the 2020 COVID-19 Early Release of Super where you had the option to withdraw $10,000 should you meet the eligibility criteria. You cannot move your existing super balance into this scheme.

How do you get your hard earned income into this scheme?

• You can start making contributions via salary sacrifice, it’s not an automatic process you have to request this to be arranged through your employer.
• Salary sacrifice is when you agree to have a portion of your pay go straight into your super fund before it hits your bank account (this is in addition to the compulsory super contributions your employer makes).

Is the admin burden worth the reward?

• Let’s say you earn $100,000 per year before tax. That’s around $2,000 a week before tax.
• Ask your employer to contribute $200 a week to super via salary sacrifice.
• That $200 goes in before tax, so it’s treated as a concessional contribution.
• Concessional contributions are taxed at 15% in super, instead of your 30% marginal tax rate on a $100,000 salary.

In short, you’re redirecting income to save on tax while building your deposit through the First Home Super Saver Scheme.

Can I transfer money I have in the bank into this scheme?

If you’ve set up a ‘House Bucket’ after reading The Barefoot Investor and you’re wondering if those savings can be used in this scheme, here’s the deal.

You can use them, but the money will need to go into your super account first. As you might expect, it’s not as simple as moving cash between everyday accounts.

Instead, you’ll need to make a personal after-tax contribution to your super. These are known as non-concessional contributions.

This is a different category to concessional super contributions.

All of these fall under voluntary contributions.

It’s got more layers than an onion and just as likely to make you cry.

Are there contribution caps and what is the difference?

• Concessional contributions: $30,000 annual cap

  These come from your pre-tax income and are taxed at 15% once they enter your super fund. This cap includes:

  • Salary sacrifice contributions you make.
  • Your employer’s compulsory super contributions (usually 12%, but it may be higher).

• Non-concessional contributions: $120,000 annual cap

  These come from your after-tax income or savings, and aren’t taxed again when they enter your super. As long as you don’t claim a tax deduction for them, they’re classed as non-concessional.

  • These contributions are separate from your employer’s compulsory super and any salary sacrifice amounts.
  • They are in addition to any concessional contributions you make.

• First Home Super Saver Scheme
  

  This is the super side-pocket you’re contributing to in order to save for your first home deposit.

  • $15,000 annual cap for eligible voluntary contributions.
  • $50,000 total cap across all years. That’s the maximum you can withdraw under the scheme.

Contributions above the set caps can lead to the unintended consequence of more tax.

Before tinkering with your super, do your research and seek professional advice to make sure this scheme is right for you.

The First Home Super Saver Scheme comes with eligibility requirements, withdrawal rules, caps, and tax concessions and considerations.

The tax system is a beast. Complex and interconnected. Every change has a flow-on effect to the bigger picture. The only thing worse than being stuck renting when you’re trying to buy your first home is being hit with a tax bill you didn’t see coming.

First Home Guarantee – Commonwealth Program

The first program shows you how to make the most of your own hard-earned income, but what is the Commonwealth Government actually putting on the table beyond helping people stretch their own savings?

To buy a home you usually need at least 20% of the property price as a deposit.

The First Home Guarantee Scheme allows eligible buyers purchase with just a 5% deposit. The government guarantees the remaining 15%, giving the bank confidence without making you cough up thousands in insurance.

There are some home loans that allow you to borrow with a smaller deposit, but in return you have to pay Lenders Mortgage Insurance (LMI).The insurance cost is put in place because you are perceived as a higher risk since you are asking to borrow 95% of the cost of the house.

It’s not as simple as pulling together a 5% deposit and asking the government to co-sign like they’re the Bank of Mum and Dad. There are eligibility criteria, property price caps, and you’ll be competing for just 35,000 places nationwide each year.

• You must be a first-home buyer, earning under $125K (single) or $200K (joint applicants).
• You need to actually live in the property.
• You can’t have owned property in Australia in the past 10 years.
• Property price caps top out at $900,000 in Sydney and are lower elsewhere.
  

First Home Buyers Assistance Scheme – State Program (NSW)

When it comes to support offered by State Governments, stamp duty is usually a key focus as it’s controlled at the state level and comes with a hefty price tag.

Stamp Duty is essentially a one-off government tax you pay when buying a home or land. It’s not small, the cost is often tens of thousands of dollars on top of your deposit and it has to be paid upfront.

For example, buying an $800,000 home in NSW could mean paying over $30,000 in stamp duty, just to transfer the property into your name.

Under the First Home Buyers Assistance Scheme, the NSW Government changed the rules in July 2023 so eligible buyers don’t pay stamp duty on homes up to $800,000, a saving of more than $30,000.

If the property is priced between $800,000 and $1 million, you can apply for a concessional (discounted) rate. You’ll still pay some stamp duty, but significantly less than the full amount.

Homes priced over $1 million aren’t eligible for the first home buyer discount. And while it’s reasonable for programs to have limits, it still feels like an uphill battle, especially when Sydney’s median house price hit a record $1.7 million in July 2025.

This is just a snapshot of the government programs designed to make home ownership more attainable. They sit alongside broader efforts to build more homes, deliver supporting infrastructure, make renting fairer, and boost funding for homelessness services to strengthen the safety net.

For the record, this isn’t financial advice. I pursued a career in words, not numbers, for good reason. But the housing crisis is now so dire, it wouldn’t be surprising if people started seeking advice from a lifelong renter with no finance background.

Deciphering the fine print can feel overwhelming. So do your research, ask questions, get second opinions and seek professional advice.

While the foundations for rebuilding our housing system are finally being laid, the growing anxiety around housing insecurity is rising even faster than rent or the pace of new builds.