First home buyer guide for Australia.
A working guide for first home buyers in Australia. Deposit and budget, the grants and schemes that actually matter, pre-approval, due diligence, settlement, and what to do in the first months after.
Budget and deposit, properly.
The deposit number is downstream of the borrowing capacity. Work the budget first, then the deposit follows.
Most first home buyers start with the wrong question. They ask "how much can I borrow" before they have worked out what they can actually afford to repay comfortably for the next thirty years. The two numbers are not the same. A broker can tell you your maximum borrowing capacity in an afternoon, but the right number is usually meaningfully less. Worth running the repayment numbers before any contract conversation.
On the deposit side, three working scenarios cover most files. A 5% deposit (the minimum for most mainstream lenders) typically requires the First Home Guarantee or a family guarantor to avoid lenders mortgage insurance. A 10% deposit can work with LMI or with the FHBG scheme, and is the most common starting point on a typical first home buyer loan. A 20% deposit removes LMI entirely and broadens the lender panel, but the time it takes to save 20% for many first home buyers in capital city markets means a smaller deposit with a scheme is often the more practical path. State stamp duty concessions for first buyers also shift the total cash needed at settlement.
Genuine savings is the other piece. Most lenders want to see at least 5% of the purchase price held in your name for three months or longer, evidencing that you can save consistently. Gifts and one-off windfalls do not count as genuine savings even if they sit in the account. Build the savings habit early, ideally a year before you plan to buy.
- 5% deposit
- Usually needs FHBG or guarantor to avoid LMI
- 10% deposit
- Common starting point, LMI applies unless scheme used
- 20% deposit
- No LMI, full lender panel, often unrealistic timeline
- Genuine savings
- 3+ months of consistent saving in your name
- Stamp duty (state)
- Varies. Concessions for FHBs in most states
- Conveyancer
- $1,500 to $2,500 typical, including searches
First home buyer grants and schemes.
Five distinct programs, each with its own eligibility and caps. Most first home buyers will use one or two of them, not all five.
First Home Owner Grant (state)
Cash grants for buying or building a new home, administered by state revenue offices. Amounts and price caps differ by state. Current as at this guide's date, check your state revenue office for the live figures.
First Home Guarantee
Federal scheme administered by Housing Australia. Buy with 5% deposit, no LMI, government guarantees the difference. Income caps and property price caps apply. Limited places per financial year.
Family Home Guarantee
For single parents with at least one dependent child. Buy with as little as 2% deposit without LMI. Same Housing Australia administration. Price and income caps apply.
Regional First Home Buyer Guarantee
For first home buyers purchasing in a designated regional area. Similar 5% deposit, no LMI structure. Eligibility is tied to the regional postcode list, which is reviewed periodically.
FHSS scheme
First Home Super Saver scheme. Make voluntary concessional contributions to super (within the cap), pay 15% contributions tax, then withdraw to fund the deposit. The tax saving is real for salaried buyers.
Stamp duty concessions
Most states offer first home buyer stamp duty concessions or full exemptions below a threshold. The threshold and the size of the concession differ meaningfully between states.
Scheme amounts, caps and eligibility rules are current as at this guide's publication date and are reviewed regularly. Always confirm the live figures with your state revenue office or Housing Australia before relying on them.
Pre-approval, in plain English.
Pre-approval is a lender's indicative agreement to lend you up to a certain amount, based on your income, expenses, deposit and credit history. It is not a guarantee. The actual loan is approved only once a specific property is assessed and the lender is comfortable with the valuation.
Conditional pre-approval is the standard form. The lender has reviewed your file and is ready to proceed, subject to a satisfactory property. Unconditional approval comes after the contract is signed and valuation is completed. Some lenders issue indicative-only assessments that should not be relied on as pre-approval; check what you actually have.
The process typically takes a week to three weeks depending on the lender, the complexity of the income (PAYG vs self-employed), and how organised your paperwork is. Two recent payslips, two years of tax returns if self-employed, three to six months of bank statements, and ID are the standard pack. A good broker will line these up before submission, not after the lender asks.
Pre-approval is usually valid for three to six months. After that it expires and a fresh assessment is needed. Plan the timing so the pre-approval is live when you are actively bidding. The broader first home buyer hub covers how pre-approval fits with grants, insurance and the super review.
The buyer's agent question.
For first home buyers, it's worth being honest about when this service helps and when it does not.
A buyer's agent works for you, not the seller. They build a shortlist, inspect on your behalf where helpful, run due diligence, and negotiate the price. The fee is usually a fixed amount, paid in stages, and at Opes it sits on a fixed-fee model rather than a percentage of the purchase price.
For a first home buyer purchasing a familiar property in a familiar suburb, the service is often not needed. You can read the listings, walk the open homes, and negotiate yourself. Where the value compounds is in unfamiliar markets, with time-poor buyers, or with house purchases where the contract review and condition of the building genuinely matter.
If you're unsure, the first conversation is free. We will tell you plainly whether the brief warrants the service. See the first home buyer agent page for the detail of how the service runs alongside the broker side of the file.
Inspections and the contract review.
Three reports and one careful conveyancer. The combined cost is small. The protection is substantial.
Building inspection
Independent licensed inspector. Structural integrity, moisture, roof condition, drainage, electrical. A clean report does not mean a perfect house, but a major issue uncovered here saves you many times the inspection fee.
Pest inspection
Termites and other timber pests. Usually combined with the building inspection in one visit. Particularly important for older timber-framed homes and houses with subfloor access.
Strata report
For apartments and townhouses. Reviews the body corporate finances, special levies, planned works, and any disputes. A small expense that often reveals the bigger issues.
Contract review
Your conveyancer or property lawyer reviews the contract before you sign. Particular things to watch: deposit terms, settlement period, vendor warranties, easements, and any special conditions inserted by the seller.
Title and council searches
Conducted by the conveyancer. Confirms the title is clean, no caveats, no unexpected easements, no outstanding council issues. Standard practice for every purchase.
Insurance pre-settlement
Home and contents insurance should be in place from the day of settlement, ideally arranged a week before. Some lenders require evidence of insurance as a condition of unconditional approval.
The settlement timeline.
From the moment you sign a contract, a clock starts. The standard settlement period is 30 to 60 days, with 45 days the most common. During this window the lender completes the property valuation, issues unconditional approval, and the conveyancers on both sides exchange documents.
Week one is the cooling-off period in most states for private treaty purchases (none applies at auction). The cooling-off varies in length and conditions by state. After it expires, the contract is binding.
Weeks two and three are the lender's due diligence. Valuation, final credit assessment, mortgage documents drafted and signed, and unconditional approval issued. Your conveyancer is running title searches, lodging caveat where appropriate, and coordinating with the seller's side.
Weeks four and five are settlement preparation. You arrange building insurance, you sign the mortgage documents with the lender, you transfer funds for the balance of deposit and adjustments to your conveyancer's trust account, and you book a pre-settlement inspection of the property. On settlement day the funds are exchanged, title transfers, and the keys are released. The wider home loan mechanics are the same across owner-occupier files, first home or otherwise.
Post-settlement priorities.
The buy is the start, not the end. Three things to lock in once the keys are yours.
Income protection
If your income stops because of illness or injury, the mortgage does not stop with it. Income protection covers a percentage of your income (typically 70%) after a waiting period. The premium is usually tax-deductible when held in your personal name.
Read moreWill and estate review
Buying a home is the trigger for most people to actually write a will or update an old one. A simple will covering the property, super beneficiary nominations, and an enduring power of attorney are the working minimum.
Read moreSuper review
Your household balance sheet has shifted. Review which super fund holds your balance, the insurance cover inside it, the investment option, and whether consolidation makes sense. This is the moment most people's super gets actively managed for the first time.
Read moreQuestions first home buyers ask.
Most lenders will look at a file with a 5% genuine savings deposit, though lenders mortgage insurance will apply below 20% unless a government guarantee or family arrangement covers the gap. The right deposit for you depends on the purchase price, the lender, and which grants and schemes you qualify for. A 10% to 15% deposit is the most common starting point for first home buyers using the First Home Guarantee.
It is a federal scheme administered by Housing Australia that lets eligible first home buyers purchase with as little as 5% deposit without paying lenders mortgage insurance, because the government guarantees the difference. Places are capped each financial year, and there are income caps and property price caps that vary by state and region. We check eligibility before the application goes in.
For most salaried first home buyers with at least a couple of years to save, the FHSS scheme is worth modelling. You make voluntary concessional contributions to your super (within the cap), pay 15% contributions tax instead of your marginal rate, and then withdraw the contributions plus deemed earnings to fund the deposit. The tax saving is real, but the process takes time. Worth planning early rather than mid-purchase.
Not always. If you are buying a single-bedroom unit in a familiar suburb, you probably do not. If you are buying a house in an unfamiliar market, are time-poor, or feel uncertain about reading contracts and negotiating, the time saved and the price discipline a buyer's agent brings often cover the fee. The initial consultation is free and we will tell you straight if it is not warranted.
From contract signed to settlement, the standard timeline is 30 to 60 days, with 45 days the most common. Some contracts allow longer, especially for off-the-plan or vendor-led terms. Pre-approval and the conveyancer should both be lined up before contracts so the period is workable.
Most pre-approvals are conditional, meaning the lender has reviewed your income, expenses and credit, but has not yet assessed a specific property. Once you have a contract, the lender completes valuation and final credit checks, and issues unconditional approval. A property can fall through if the valuation comes in low, so price discipline at the offering stage matters.
For a typical house, expect $500 to $800 combined for building and pest. Strata reports for an apartment usually sit between $250 and $400. The cost is small relative to the purchase, and a properly read report is one of the few things that genuinely protects you from a bad purchase. Skipping inspections to save a few hundred dollars is among the most common regrets we see.
Three things in particular. First, sort income protection so the mortgage is covered if your income stops. Second, get a will in place that reflects the new asset. Third, review your super and insurance held inside it now that your household balance sheet has changed. None of this is urgent the day after settlement, but it should not slide past the first couple of months.
Read further
- First home buyer loansHow the broker side of the file is run.
- First home buyer agentBuyer's agent service tailored for first home buyers.
- Home loansThe 50+ lender panel and how pre-approval works.
- Home loan calculatorWorking out the repayment number before the conversation.
- Income protectionCover the mortgage if your income stops.
- Financial planningThe wider plan around the purchase.
Buying your first home? Start with a chat.
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