Single Parent Family Home Guarantee ignores the real housing problem

On Tuesday the 11th of May, the treasurer Josh Frydenberg will announce the budget and a new program to help separated and divorced parents buy a home called the Single Parent Family Home Guarantee. got the details of the package early.

The Single Parent Family Home Guarantee will support up to 10,000 divorced / separated parents (who have care of dependent children). The scheme will start on the 1 July 2021. Extra places may be added to the program if the 10,000 places are exhausted.

Based on the First Home Loan Deposit Scheme, this has the same property price capsbut is not limited to first home buyers because many single parents have previously been home-owners. 

The new government single parent home buyers 2% deposit scheme

It allows eligible single parent with dependents seeking to apply for a mortgage loan with a lower deposit, just 2 per cent, much lower than usual. The government guarantees up to 18 per cent of the loan, allowing the borrower to avoid the cost of lenders mortgage insurance (LMI).

Get all the details of this scheme at

Both ACOSS and the National Council for Single Mothers and their Children point at that mothers in insecure housing may not benefit from this.

This scheme will benefit single parents with a good secure income, enough to support a mortgage so possibly those with a low care percentage of the children. The applicant will still need 2 per cent of the loan up front plus pay the fees, legals and stamp duty.

Applications are made through the participating lenders, two of the big banks and twenty credit unions.

This scheme will not benefit low income parents in insecure housing. 47 per cent of single parents are currently renting in the private market, almost twice the rate for two-parent families.

Unless the renter has savings in the bank and really good job, this scheme will not make a difference. The loan must be supported and repaid with just one income! The 18 per cent government guarantee is not actual money. The 18 per cent is added onto the loan amount, so is repaid, with interest by the single parent.

It’s open for people who have previously owned a property so they may also have at least 2 per cent of the loan amount to contribute as deposit.

This Single Parent Family Home Guarantee will be great for parents with the ability to repay a mortgage by themselves, so probably parent with a small care percentage of the children, plus they need significant cash or assets already.

300,000 single parents were cut off the $550 Coronavirus supplement, meaning they probably get Youth Allowance or JobSeeker or another Centrelink payment. So those people will probably not have a deposit or the ability to repay a mortgage by themselves.

This is a policy for quite well off single parents. This policy does nothing to help struggling single parent families in insecure housing.

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