The Role of the First Home Super Saver Scheme in Building Home Deposits
For many young Australians, buying a first home can feel out of reach. With property prices climbing and the cost of living stretching budgets, saving for a home deposit has become one of the biggest hurdles in achieving homeownership.
A home deposit is the initial lump sum paid upfront when purchasing a property, and it plays a major role in shaping loan opportunities. A larger deposit can make it easier to access competitive mortgage rates, lower repayments and avoiding lender’s mortgage insurance, while also showing lenders financial readiness. For first-time buyers, reaching this milestone is a significant step toward securing a place in the property market.
First Home Super Saver Scheme
Government initiatives such as the First Home Super Saver Scheme (FHSSS) have become increasingly relevant. This scheme allows eligible Australians to make voluntary contributions to their superannuation, which can later be released to help fund a home deposit. Contributions made through the FHSSS can be taxed at a lower rate than most regular savings, meaning the scheme offers a unique pathway for home deposit funds. As of 2025, individuals can access up to $50,000 of voluntary contributions, plus associated earnings, for their first home.
The Nitty Gritty Detail...
Under the scheme, voluntary contributions can be made in two ways: as concessional contributions (CCs), which are made before tax and generally taxed at 15% inside super, or as non-concessional contributions (NCCs), which are made from after-tax income. Both types count towards the withdrawal cap under the FHSSS. Then, in the super environment, any distributions and capital gains are taxed between 10-15%, which can often be lower the individual marginal tax rate. To release the savings, an application is lodged with the Australian Taxation Office (ATO) through the “FHSS release request” form. Once approved, the ATO calculates the releasable amount, withholds the appropriate tax, and then transfers the funds to the individual, ready to be used for a home deposit.
Other Schemes
Alongside the FHSSS, programs like the First Home Guarantee may reduce the deposit requirement for eligible buyers, further lowering the entry barrier to homeownership. These initiatives highlight the importance of understanding the tools available to young Australians navigating today’s housing market.
While the journey to saving a deposit can be challenging, schemes such as the FHSSS have become vital in helping individuals own their own home.