A first home buyer gets into the Australian market by saving a deposit (often 5 to 20 percent of the price), then stacking the government schemes you qualify for: the federal Home Guarantee Scheme to skip lenders mortgage insurance, a state First Home Owner Grant, state stamp duty concessions, and the First Home Super Saver. Sort those out, get pre-approval, then follow the buying journey from search to settlement.
That is the short version. The longer version is where the real money lives, because the schemes change often, the thresholds vary by state, and the difference between knowing them and not can be tens of thousands of dollars. Here is how it all fits together.
Start with the deposit
The deposit is the headline number, and it is usually the thing standing between you and a contract. Lenders traditionally want 20 percent of the purchase price. On a typical home that is a serious amount of saving, which is exactly why the schemes below exist.
If you have less than 20 percent, you can still buy. You will normally pay lenders mortgage insurance (LMI), which protects the lender (not you) if the loan goes bad. LMI can run into the thousands or tens of thousands depending on the loan size and deposit. Our guide to LMI walks through how it is calculated and when it is worth paying anyway.
Before you fixate on a deposit figure, it helps to know what you can actually borrow. You can work out your borrowing power and then reverse engineer the deposit from there. For a deeper run through the maths, see how much can I borrow.
The Home Guarantee Scheme: a smaller deposit, no LMI
The federal Home Guarantee Scheme is the big one for buyers who are short on deposit. In broad terms, it lets eligible first home buyers purchase with as little as a 5 percent deposit without paying LMI, because the government guarantees part of the loan.
The catch is that it comes with conditions, and those conditions move:
- Income caps that limit who qualifies
- Property price caps that vary by city and region
- A limited number of places, which can run out
Because places are limited and the caps are reviewed, treat any figure you read (including ours) as a starting point rather than gospel. Confirm the current rules and your eligibility with the scheme administrator before you bank on it.
The First Home Owner Grant (FHOG)
The First Home Owner Grant is a state and territory payment, not a federal one, so the amount and the rules depend on where you buy. As a general pattern across June 2026, the grant is often restricted to newly built or substantially renovated homes rather than established ones, and the dollar amount varies meaningfully from state to state.
If you are buying an established home in an established suburb, there is a decent chance the FHOG will not apply to you at all. That is not a dealbreaker, because the next saving is often larger.
Stamp duty concessions: frequently the biggest win
Stamp duty (also called transfer duty) is a state tax on property purchases, and for first home buyers it is often where the largest saving sits. Most states and territories offer first home buyer concessions or full exemptions up to certain price thresholds, with a tapering band above that where the discount shrinks as the price climbs.
The thresholds differ by state and are adjusted from time to time, so a property that is fully exempt in one state might attract partial duty in another. For a worked example in one market, see our stamp duty in NSW explainer, and always check your own state revenue office for the figures that apply to you.
Chase the stamp duty concession before the grant. The exemption is often the bigger number, and it applies to far more buyers.
The First Home Super Saver Scheme
The First Home Super Saver Scheme lets you save part of your deposit inside superannuation and later withdraw it for a first home, up to a cap. The appeal is tax: voluntary contributions made this way are generally taxed more lightly than money saved in an ordinary bank account, so the same effort can leave you with a bit more.
It is not a magic doubling of your money, and there are limits on how much you can contribute and withdraw, plus timing rules on when you can take it out. Used sensibly alongside a normal savings plan, it is a quiet way to make a deposit grow a little faster. As with every scheme here, the caps are reviewed, so confirm the current numbers before you rely on them.
How the schemes stack
These pieces are designed to work together. A typical first home buyer might use the Home Guarantee Scheme to buy with a small deposit and dodge LMI, claim a stamp duty concession to slash the upfront tax, and have built part of the deposit through the First Home Super Saver, with the FHOG on top if they are buying new.
Whether all of them apply to you depends on your income, the price, the property type, the state, and the rules in force on the day you buy. None of this is personal financial advice, and the only way to know what you genuinely qualify for is to check with the relevant body.
The buying journey, step by step
Once the money side is mapped, the purchase itself follows a fairly predictable path. Here is the order it usually runs in:
- Work out your borrowing power and a budget. Be honest about repayments at higher interest rates, not just today’s.
- Save the deposit plus costs. Budget for stamp duty, LMI if you are under 20 percent, conveyancing, building and pest inspections, and moving.
- Get pre-approval. This tells you a realistic price ceiling and signals to agents that you are serious.
- Search and do your due diligence. Inspect properties, read contracts, and order building and pest checks before you commit.
- Make an offer or bid at auction. Private treaty offers can carry conditions, but auction purchases generally do not, so know the difference.
- Exchange contracts and pay the deposit. This is the point the deal becomes binding, subject to any cooling off period.
- Settlement. The balance is paid, the title transfers, and the keys are yours.
A guarantor can shorten the saving stage if a family member helps secure the loan. The trade offs are real, so read our guarantor home loan guide before going down that road.
Costs beyond the deposit
The mistake that catches first home buyers is budgeting only for the deposit. The extras add up, and they are due at different times. This table sets out the usual suspects.
| Cost | What it covers | Rough timing |
|---|---|---|
| Stamp duty | State transfer tax, often reduced or waived for first buyers | At or before settlement |
| LMI | Lender insurance if your deposit is under 20 percent | Added to the loan or paid upfront |
| Conveyancing | Legal transfer of the property | During the purchase |
| Inspections | Building and pest reports | Before you commit |
| Moving and connections | Removalists, utilities, and the boring bits | Around settlement |
Figures across all of the above are best treated as ranges, last checked June 2026, and they shift with the market and with policy. Do not plan to the last dollar on numbers you read online.
The bottom line
Getting into the Australian market as a first home buyer is less about one big break and more about stacking several smaller ones: a workable deposit, the Home Guarantee Scheme to avoid LMI, a stamp duty concession that often saves the most, the FHOG if you are buying new, and the First Home Super Saver doing quiet work in the background. Map the money first, get pre-approval, then follow the buying journey from search to settlement.
The schemes and thresholds genuinely do change, the figures here are general and hedged as at June 2026, and none of this is personal financial advice. Before you rely on any number, confirm your eligibility and the current rules with the federal scheme administrator and your state revenue office. For the bigger picture on borrowing and loan types, our home loans in Australia guide is the next stop.