The mortgage on a typical Newcastle house would drop by up to $358,000 under a Labor scheme to address housing affordability.
Labor's Help to Buy policy would involve the government taking up to 30 per cent equity in an existing house or 40 per cent in a new build then recouping the money and a corresponding share of any capital gain when the property was sold.
Buyers would have to earn less than $90,000 a year, or $120,000 for families, to qualify, have saved a 2 per cent deposit and be eligible for a standard home loan with a participating lender.
In Newcastle and Lake Macquarie, where the median house price now stands at $914,000, the scheme could reduce the value of a typical mortgage by $358,000 on a new build or $268,000 on an existing house.
The policy covers houses worth up to $950,000 in Sydney, Newcastle and Lake Macquarie or up to $600,000 in the rest of the Hunter. Price caps vary across the nation.
Opposition leader Anthony Albanese announced Help to Buy at Labor's campaign launch on Sunday.
With a 2 per cent deposit on a $914,000 house, a typical Newcastle homebuyer's mortgage would fall from $896,000 to $537,000 on a new house and to $627,000 on an existing property.
St Vincent de Paul Society said on Monday that it supported a "well designed and targeted shared equity housing program to help low- and middle-income earners into a home while avoiding upward pressure on prices".
"The Help to Buy shared equity program ... is welcome as part of a broader approach promising structural reform," Vinnies national president Claire Victory said.
"Australia desperately needs further reforms to address the housing and homelessness crisis."
Vinnies says the next government should raise JobSeeker and rent assistance, reinstate the National Rental Affordability Scheme and establish national minimum standards for renters and landlords to manage tenancy issues.
Scott Morrison has criticised Help to Buy, saying voters do not want governments taking equity in their houses and sharing in capital gains.
The Coalition has vowed to raise price caps in the Home Guarantee Scheme, which allows mostly first home buyers to enter the market with a 5 per cent deposit.
Greens leader Adam Bandt and some economists have suggested the Labor scheme could drive house prices even higher.
The Property Council of Australia has welcomed Labor plan and Mr Albanese's pledge to set up a National Housing Supply and Affordability Council to address housing shortages.
The industry group's chief executive, Ken Morrison, said the 10,000 annual cap on the scheme meant it was "unlikely to distort housing markets or prices".
Newcastle Labor MP Sharon Claydon said housing affordability was "hands down one of the biggest issues that people report to me" and affected buyers, renters, those needing public and community housing and women fleeing domestic violence.
