Australian interest rates Australian Property

First home buyers sweat on future rate hikes

Monday 16 February 2026

The Australian Treasury set aside $35.7 million in contingent liabilities for defaults under the federal government’s 5% deposit scheme for home buyers in the mid-year budget update in December.

Under this scheme, the Treasury guarantees 15% of first-home buyer mortgages, allowing homes to be purchased with only a 5% deposit without requiring lenders’ mortgage insurance.

The 5% deposit scheme has proven extremely popular.

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About the author

Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness. Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.