How much deposit do I need to buy a house?
How much deposit do I need to buy a house in Australia?
Hint: it might be less than you think.
When most people start thinking about buying a home, they assume they’ll need a 20% deposit — but that’s not always the case.
The truth is:
- You might only need 5% of the purchase price
- Some buyers get in with as little as 2% (with the right government support)
- And there are even ways to buy with no deposit saved if you have a guarantor
The key is understanding your options, the additional costs involved (like stamp duty and LMI), and putting together a plan that works for you.
What Is a Deposit — And Why Does It Matter?
Your deposit is the portion of the purchase price you contribute upfront. Most banks like to see a 20% deposit — but that’s not a strict rule.
First home buyers may be eligible to buy with as little as 5%, and some government-backed schemes (like the First Home Guarantee or the Family Home Guarantee) reduce the barrier even further.
But there’s more to buying a home than just the deposit itself. You also need to budget for:
- Stamp duty (unless you’re exempt)
- Government fees (like title transfer)
- Lenders Mortgage Insurance (LMI), if you borrow over 80%
- Legal or conveyancing costs
All of these make up your total contribution — the real amount you’ll need before you can settle on your dream home.
Real-Life Examples: What You’ll Actually Need
Let’s walk through a few realistic examples using Victorian costs. These will differ a bit by state, but the principles stay the same.
Scenario 1: Single Buyer Using the First Home Guarantee
5% deposit, no LMI, no stamp duty.
- Purchase Price: $600,000
- Stamp Duty: Exempt
- Government Fees: $1,645
- LMI: Waived
- Legal/Conveyancing: $1,500
- Total Cost: $603,145
- Bank Loan (95%): $570,000
- Contribution Needed: $33,145
A quick note on eligibility: schemes like the First Home Guarantee or stamp duty exemptions depend on things like your income, whether you’ve owned property before, and the value of the home you’re buying. For example, in Victoria, the First Home Guarantee is generally available for properties under $600,000–$700,000, and for single applicants earning under $125,000 or couples under $200,000 combined.
Scenario 2: Couple Buying First Home, No First Home Guarantee
10% deposit, LMI applies, no stamp duty.
- Purchase Price: $600,000
- Stamp Duty: Exempt
- Government Fees: $1,370
- LMI (Estimated): $14,000
- Legal/Conveyancing: $1,500
- Total Cost: $616,870
- Bank Loan (90%): $540,000
- Contribution Needed: $76,870
Scenario 3: Buying Over the First Home Buyer Thresholds
20% deposit, no grants, full stamp duty.
- Purchase Price: $800,000
- Stamp Duty (VIC Estimate): $43,070
- LMI: Not applicable (20% deposit)
- Legal/Conveyancing: $1,500
- Total Cost: $844,570
- Bank Loan (80%): $640,000
- Contribution Needed: $204,570
What If You’re Buying in Another State?
If you’re in NSW, QLD, WA or elsewhere, I can tailor the numbers and walk you through what’s available in your area.
What If You Don’t Have a 20% Deposit?
You still have plenty of options:
- 5% deposit loans through select lenders
- First Home Guarantee (no LMI) if eligible
- Guarantor loans with help from a parent or family member
- LMI waivers for certain professions (like doctors, nurses, teachers)
It’s not about hitting a magic number — it’s about creating a strategy that fits you.
Let’s Work It Out Together
Everyone’s situation is different. Whether you’re starting with $20k or $120k, I’ll help you understand your total upfront cost, make the most of any government support available, and get your home loan plan moving, without the stress.
Book a free 15-minute chat or email jane@justrightlending.com.au with any questions.
Your dream of owning a home might be closer than you think.