Can a Single Parent Buy Out a Former Partner With Help to Buy?
By Broker Codex Editorial
Yes, a single parent can use the federal Help to Buy scheme to purchase a former partner's share of the family home. This is one of the few government home ownership schemes that explicitly allows it, naming the co-owner buyout as a qualifying reason in the scheme's own customer guide.
Why This Matters for Separating Parents
There is a specific moment in a separation where the numbers stop being abstract. You have worked out roughly what your former partner's share is worth. You have looked at your borrowing capacity on one income. And the gap between those two numbers is the reason people start researching rentals in a suburb they do not want to move to.
I see that gap a lot. What I do not see often enough is people knowing that Help to Buy was written with them in mind. The scheme gets talked about almost entirely as a first home buyer product, so single parents who already own half a house tend to rule themselves out before anyone has run the numbers. That is a shame, because for some people this closes the gap entirely.
How Does Help to Buy Actually Work?
Help to Buy is a shared equity scheme. Rather than lending you money, the government buys a share of your home alongside you.
For an existing home, the government contributes between 5 and 30 per cent of the purchase price.
For a newly built home, it contributes between 5 and 40 per cent.
You need a minimum 2 per cent deposit of your own.
There is no LMI (Lenders Mortgage Insurance), because the government's contribution is sized to help you avoid it.
Your loan is smaller, so your repayments are smaller.
The trade is straightforward. Because the government owns a share, it shares proportionally in any gain or loss when the property is eventually sold. If the government holds 25 per cent and the home is worth $800,000 when you sell, its share is $200,000.
You can also buy the government out over time. Partial repayments must be at least 5 per cent of the home's current value, and the price is based on a valuation at the time you repay. You pay for the valuation.
There are 10,000 places available each year, with a further 10,000 released from 1 July 2026.
Can You Really Use It to Buy Out a Former Partner?
This is the part that surprises people, so it is worth quoting the scheme directly.
The Help to Buy customer guide states that while applicants generally cannot currently own any property in Australia or overseas, single parents may qualify if they "plan to buy out a co-owner: you can use Help to Buy to purchase your former partner's share in a jointly owned home."
The same exception covers a second scenario. If you are selling a different property rather than buying out a co-owner, you need to complete that sale within 4 weeks of settling on your Help to Buy home. Housing Australia can extend that window where you are experiencing hardship that makes selling impractical, where you can give valid reasons for the delay, or where other compassionate circumstances apply.
For the scheme's purposes, a single parent is someone who does not have a spouse or de facto partner and has at least one dependent. If you are separated but not yet divorced and no longer living with your former partner, the government's own guidance is to raise it with your participating lender rather than assume you are out.
Do You Actually Qualify?
Work through these before you get attached to the idea.
Income. Your taxable income needs to be $165,000 or less, taken from your ATO Notice of Assessment for the preceding financial year. Single parents get the same threshold as joint applicants, not the lower $103,000 single figure. This is one of the quieter design decisions in the scheme and it makes a real difference.
Property price caps. The home needs to sit at or under the cap for its location. As at August 2026 those caps are:
New South Wales: $1,300,000 in capital city and regional centres, $800,000 elsewhere
Victoria: $950,000 in capital city and regional centres, $650,000 elsewhere
Queensland: $1,000,000 in capital city and regional centres, $700,000 elsewhere
Western Australia: $850,000 in the capital city, $600,000 elsewhere
South Australia: $900,000 in the capital city, $500,000 elsewhere
Tasmania: $700,000 in the capital city, $550,000 elsewhere
Australian Capital Territory: $1,000,000
Northern Territory: $600,000
Check the specific postcode with your lender, because the boundary between "regional centre" and "elsewhere" is not always where you would guess.
The basics. You need to be at least 18, an Australian citizen, and the home needs to be your principal place of residence. Investment properties do not qualify. You also cannot be using a state or territory shared equity scheme at the same time.
The costs on top. The 2 per cent deposit is the floor, not the total. You still need funds for stamp duty where it applies, legal and conveyancing fees, valuations, inspections and building insurance. Worth noting: transfers between separating couples are often exempt from or concessional on stamp duty depending on your state and whether the transfer happens under a formal family law agreement. Ask your conveyancer early, because it can be a large number either way.
What Does Giving the Government a Share of Your Home Mean Day to Day?
Less than people expect, but it is not nothing.
The home has to remain your principal place of residence.
You need to keep full replacement building insurance in place.
You need to maintain the property in good condition and pay the rates, utilities and upkeep as normal.
Housing Australia reviews your income at least every five years.
You need to notify Housing Australia of major renovations above $21,000, indexed annually.
If you accept an offer to sell, you notify Housing Australia immediately.
None of that is onerous. But it does mean the government is a co-owner with reporting obligations attached, and that is a genuinely different feeling from owning outright. Some people are completely at peace with it. Others would rather borrow more and own the lot. Both are reasonable answers, and the right one depends on what you want the next ten years to look like, not just what the spreadsheet says.
How Does This Compare With the 5 Per Cent Deposit Scheme?
The Australian Government 5% Deposit Scheme is the other obvious option, and single parents and legal guardians can use it with a 2 per cent deposit. Since 1 October 2025 it has had no income caps, no waitlists and unlimited places, and single parents do not need to be first time buyers.
The catch for this particular situation is the ownership rule. Under the 5% Deposit Scheme you cannot hold any other property interest once your new home settles, and the guarantee is designed around purchasing a home rather than acquiring a co-owner's share of one you already own. The published guidance does not address the buyout scenario, so if that is your plan it needs to be a conversation with a participating lender rather than an assumption.
A short way to think about the choice:
Help to Buy may suit you if you want to stay in the home you jointly own, take over your former partner's share, and your income sits under $165,000.
The 5% Deposit Scheme may suit you if you are buying a different home, your income is above the Help to Buy cap, or you would rather own 100 per cent from day one.
Running both side by side is worth doing. They lead to very different loan sizes and very different repayments, and the better option is not always the obvious one.
How Do You Apply?
You do not apply to Housing Australia. You apply through a participating lender, who assesses your eligibility and lodges on your behalf.
As at late July 2026 there were three participating lender groups: Commonwealth Bank, Bank Australia, and Teachers Mutual Bank Limited, which also trades as Health Professionals Bank, Firefighters Mutual Bank and UniBank. Two of the three allow mortgage brokers to facilitate applications, and which lenders that includes has shifted since the scheme launched in December 2025. It is worth confirming at the time you apply rather than relying on anything written earlier, including this.
That small panel is the real constraint here. It means the Help to Buy question is not just "do I qualify" but "does a lender that offers it also suit my income, my structure and my timeline." Worth sorting out before you sign anything in a property settlement.
Frequently Asked Questions
Do I need to be a first home buyer to use Help to Buy?
No. The general rule is that you cannot currently own property, but single parents have a specific exception that covers buying out a co-owner or selling an existing property. Having owned a home before does not rule you out.
Can I use Help to Buy if I am separated but not divorced?
Possibly. The scheme defines a single parent as someone without a spouse or de facto partner who has at least one dependent. The government's guidance for people who are separated, no longer living with their former partner, and not yet divorced is to speak with a participating lender about their specific circumstances.
What happens to the government's share if my home increases in value?
The government receives its proportional share of the property value at the time of sale, calculated on the greater of the sale price or a current valuation. If it holds 20 per cent, it receives 20 per cent. You can reduce or remove that share earlier by making repayments of at least 5 per cent of the home's current value at a time.
Does the 2 per cent deposit have to be cash savings if I already own half the house?
This is exactly the sort of question that needs a lender's answer rather than a general one, because a buyout is structurally different from a standard purchase. The published guidance frames the 2 per cent as a deposit on the purchase price. How existing equity interacts with that in a co-owner buyout is worth confirming with a participating lender before you plan around it.
Where This Leaves You
The thing I keep coming back to with this scheme is that it was written by people who understood something real. Someone who has spent years paying down a mortgage with a partner is not starting from zero when that relationship ends. They are starting from half a house and a much harder set of numbers. Help to Buy is one of the few pieces of policy that says so out loud.
It will not be the right answer for everyone. A small lender panel, an income cap and a government co-owner are all real considerations. But if you have been quietly assuming that keeping the house is out of reach, that assumption is worth testing properly before you act on it.