SENATOR DEAN SMITH
SHADOW ASSISTANT MINISTER TO THE SHADOW TREASURER
SHADOW ASSISTANT MINISTER FOR THE COST OF LIVING
LIBERAL SENATOR FOR WESTERN AUSTRALIA
21 September 2026
MEDIA RELEASE
WA FIRST HOME BUYERS BORROW $6.6 BILLION SINCE EXPANSION OF 5% DEPOSIT SCHEME
Western Australian first home buyers have borrowed a massive $6.6 billion since the Albanese Government expanded its 5 per cent deposit scheme, leaving thousands heavily exposed as house prices fall and interest rates rise.
Seasonally adjusted ABS lending figures show that between 1 October 2025 and 30 June 2026, 11,099 WA first home buyers took out $6.60 billion in new owner-occupier loans.
The data, commissioned by Western Australian Liberal Senator Dean Smith from the Parliamentary Library, shows first home buyer borrowing surged by more than $1 billion compared with the preceding nine months.
In the nine months immediately before the scheme was expanded, WA first home buyers borrowed about $5.58 billion.
In the following nine months, that jumped to $6.60 billion — an increase of more than 18 per cent.
The Albanese Government expanded the scheme from 1 October 2025, removing income limits, making places unlimited and lifting eligible property price caps to $850,000 in Perth and $600,000 across regional WA.
The expansion poured additional borrowing capacity into an already tight housing market as buyers competed for limited supply.
Perth’s median house price subsequently surged by more than $150,000 to reach $1 million over the past year.
It’s estimated more than 230,000 Australians have accessed the 5% deposit scheme since its commencement in 2020 with Western Australia consistently recording a high uptake of the scheme among the states.
But the environment confronting those recent buyers has now changed dramatically.
The Albanese Government’s May Budget announced major changes to negative gearing and capital gains tax arrangements designed to put downward pressure on property prices — just months after expanding a policy that boosted first home buyer purchasing power.
Buyer activity has since weakened, with Perth’s median house price falling 3.2 per cent over the August 2026 quarter.
That leaves the 11,099 first home buyers who entered the WA market between October and June particularly exposed.
Many bought with deposits as low as 5 per cent and now face falling property values, higher mortgage repayments and continuing cost-of-living pressures.
Comments attributable to Senator Dean Smith:
“More than 11,000 WA first home buyers borrowed $6.6 billion in just nine months after Labor dramatically expanded its 5 per cent deposit scheme.”
“The expansion of the 5% deposit scheme was a major driver in enticing more than 11,000 first home buyers into a rising market.”
“That was more than $1 billion extra borrowing compared with the previous nine months, poured into one of the tightest housing markets in the country.”
“Labor encouraged first home buyers into the market with deposits as low as 5 per cent, only to change negative gearing and capital gains tax months later with the express purpose of making housing cheaper.”
“Thousands of young Western Australians who bought in good faith are now caught between falling property values, rising interest rates and enormous mortgages.”
“For a first home buyer with only 5 per cent equity, even a relatively modest fall in the value of their home can put that equity at risk.”
“Labor told Australians its housing policies were working, yet instead, its contradictory policies risk turning the dream of home ownership into a financial nightmare for the very people it promised to help.”
ENDS