Submission to: Department of Housing, Exposure Draft – Help to Buy Regulations 2025
From: Grounded Community Land Trust Advocacy
Date: 24/09/25
1. Introduction
Grounded welcomes the opportunity to comment on the Exposure Draft of the Help to Buy Regulations 2025. We acknowledge the Commonwealth’s intent to provide merit review rights to participants in the Help to Buy scheme. Ensuring participants have fair, transparent, and accessible avenues of review is essential for consumer confidence and trust.
However, our submission raises two central concerns:
- While the listed decisions are important, the Regulations omit key decisions that directly affect participants’ financial security and the program’s public purpose.
- The broader design and fiscal treatment of Help to Buy — as a demand-side equity scheme — risks inflating housing prices, obscures the real budgetary costs of equity contributions, and does not create perpetually affordable housing stock.
2. Scope of Reviewable Decisions
The Regulations identify 15 categories of reviewable decisions. These are welcome, but incomplete. In particular:
- Valuations and resale terms: The Commonwealth share is tied to property value, yet disputes about valuation methodology are excluded from review. Valuation outcomes can dramatically affect participant liability.
- Reducing Commonwealth share: While increases to the Commonwealth share are reviewable, there is no corresponding right for participants to seek review if Housing Australia refuses a request to reduce or buy back equity.
- Financial hardship: The power to demand repayment under Program Directions is reviewable, but there is no scope for review where repayment terms themselves cause hardship.
Recommendation: Expand the list of reviewable decisions to include (a) valuation disputes, (b) refusals to permit equity buy-back by participants, and (c) hardship variations.
3. Transparency and Accountability
The Regulations depend heavily on Program Directions, which are not subject to the same level of parliamentary scrutiny as primary legislation. Participants’ rights should not hinge on unpublished or opaque criteria.
Recommendation: Publish clear, binding criteria for equity contribution percentages, repayment decisions, and hardship variations to ensure accountability.
4. Fiscal and Budgetary Concerns
The Help to Buy scheme involves substantial equity contributions from the Commonwealth. Yet these are treated as an asset swap rather than a budget cost, obscuring the program’s fiscal impact. This raises three issues:
- Interest-free financing: Participants receive what is effectively an interest-free loan from the Commonwealth. This implicit subsidy is not costed transparently in forward estimates.
- Budget exposure: If property values decline, the Commonwealth may not recoup its contribution. This risk is borne by the public but is not accounted for as an ongoing budget cost.
- No recycling into affordability: Even when recovered, funds return to general revenue rather than being ring-fenced to expand affordable housing supply.
International comparison:
- In the United Kingdom, the Help to Buy: Equity Loan scheme was explicitly costed in the national budget, with annual reports disclosing both the subsidy element (foregone interest) and the fiscal exposure from market downturns. Parliamentary committees (e.g. the National Audit Office) regularly scrutinised the value-for-money of the scheme.
- In Scotland, the Open Market Shared Equity scheme has published program evaluations that include a transparent assessment of subsidy costs, risks to government, and affordability outcomes for participants.
By contrast, the Commonwealth’s Help to Buy framework lacks clear public accounting for the true cost of its equity stake. This risks misrepresenting the program’s affordability benefits while masking fiscal exposure.
Recommendation: Treasury and Housing Australia should:
- Provide full costing of equity contributions, including the opportunity cost of interest-free loans and the fiscal risk of market downturns.
- Table an annual public report on the scheme’s fiscal impact, modelled on UK and Scottish practice.
- Establish a mechanism to recycle recovered equity into dedicated affordable housing supply, rather than returning it to general revenue.
5. Structural Issues with Help to Buy
While review rights are necessary, they cannot resolve the underlying shortcomings of the Help to Buy scheme:
- Demand-side inflation: By boosting purchasing power without addressing supply, Help to Buy risks inflating prices in tight markets.
- No perpetuity: Commonwealth equity contributions are recycled back to government, rather than locking in affordable housing stock.
- Missed opportunity: Shared equity could be structured to create perpetual affordability via Community Land Trusts (CLTs) or Ground Lease models, ensuring long-term public benefit.
Recommendation: Future regulatory and legislative settings should explore linking Commonwealth shared equity to perpetual affordability models such as CLTs or a Ground Lease Model 2.0.
6. Conclusion
Grounded supports the principle of strong consumer protections in shared equity schemes. Expanding the scope of reviewable decisions, improving transparency, and addressing fiscal and structural flaws in the program will ensure Help to Buy delivers genuine affordability rather than short-term relief.
We would welcome the opportunity to provide further evidence and discuss how community-led housing models can complement or improve upon the Commonwealth’s shared equity approach.