The Victorian Government has launched the fund, a shared equity arrangement that will make homebuying easier by reducing the amount of money eligible participants need to enter the market.
It will also relieve Victorian homebuyers from the extra financial burden of lender's mortgage insurance.
The fund is an expansion of the government's $50 million HomesVic Shared Equity Initiative, a pilot program that supported more than 335 households to buy their first home.
Eligibility criteria under the VHF will be broader than the HomesVic pilot, making shared equity accessible to more Victorians.
Under the new scheme, it is no longer necessary to be first home-buyers, people can buy in a broader range of locations, and can have higher household incomes than compared to the earlier pilot.
The VHF is available to Australian citizens or permanent residents over the age of 18, who currently don't have an interest in a property and who meet the income thresholds.
Eligible participants only require a 5 per cent deposit and the government provides up to 25 per cent of the purchase price, in exchange for an equivalent share in the property.
Aboriginal and Torres Strait Islander homebuyers can buy with a deposit as low as 3.5 per cent and receive a government contribution of up to 35 per cent, in exchange for an equivalent share of the property.
Homeowners can buy out the government's share at market value over time if they choose, with funds then reinvested to help other aspiring homebuyers get into the property market.
Eligible participants can purchase in any location in metropolitan Melbourne and are provided with a broad range of regional options when searching for their home.
The value of the property cannot exceed $950,000 in metropolitan Melbourne and Geelong, while the price cap in regional Victoria, excluding Geelong, is $600,000.
Victorian Homebuyers Fund participants are still eligible for other Victorian Government housing schemes, including the First Home Owner Grant and first home-buyer stamp duty concessions or exemptions.
For further information, visit vic.gov.au/homebuyer
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