New laws passed through Parliament are expected to facilitate easier access to home ownership for first home buyers.
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However, only 10,000 people each financial year will have access to the scheme, and a property price cap will apply.
As part of the First Home Loan Deposit Scheme eligible buyers on low to middle incomes would be able to purchase a home with a deposit of as little as 5 per cent.
The scheme will come into effect in January.
The eligibility criteria includes having taxable incomes of up to $125,000 per annum for singles and up to $200,000 for couples.
In Tasmania, the property price cap is $400,000 for cities or large regional centres, and drops to $300,000 for other areas of the state.
Cities and large regional areas are defined as areas with a population of more than 250,000.
The scheme will work on a "first in, best dressed" model with no number of guarantees per area.
Tasmanian Labor senator Catryna Bilyk said the party welcomed the release of more details.
It is still unknown which lenders will be involved and what interest rates will be.
"Given Tasmania is in the midst of a housing and homeless crisis - with Hobart's median rents now reaching the third-highest of the capital cities - any action to help first home buyers is welcome," she said.
"There are still a number of questions to be answered about the scheme.
"Labor awaits further detail and we will be monitoring the implementation of the scheme closely to ensure it results in an increase in first home buyers."