While a 20% deposit is typically the standard to secure a home loan in Australia, many buyers can enter the market with significantly less.
Depending on your financial situation and the lender’s criteria, you may qualify for low-deposit options or, in specific circumstances, a no-deposit loan.
Let’s take a detailed look at these options to determine your exact deposit requirements!
How Much Deposit Do I Need for an Australian Home Loan?
To avoid paying Lenders Mortgage Insurance (LMI), the standard deposit required is 20% of the property’s value.
However, if saving this amount is not feasible, many lenders allow you to purchase a home with as little as a 5% deposit, provided you are willing to pay the additional LMI costs.
There are low deposit and no deposit options you can choose, which allows you to get a home loan for as little as 5% deposit.
In addition, price is also a factor that affects your deposit amount. Since the deposit you pay is a certain percentage of the house price, an expensive house purchase leads to more deposit.
To get an accurate estimation, you can use our borrowing power calculator to figure out how much the banks will lend you and then calculate your deposit (which can, as we mentioned, range from 5% to 20%).
Here’s a table that shows much much minimum and maximum deposit can be for a given price:
| Property Price | 20% Deposit (No LMI) | 5% Deposit (With LMI) |
|---|---|---|
| $600,000 | $120,000 | $30,000 |
| $500,000 | $100,000 | $25,000 |
| $400,000 | $80,00 | $20,000 |
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ENROLL IN HOME BUYER INSTITUTEWhat Other Costs Are Involved in Buying a Home?
Beyond the initial deposit, you must budget for several additional government and lender fees to finalize your purchase:
- Stamp Duty: A mandatory government tax based on location and property value (e.g., approx. $20,000 for a $600k NSW home), though exemptions exist for first home buyers.
- Conveyancing and Legal Fees: Costs for solicitors to handle title transfers and paperwork, typically ranging from $1,000 to $2,000.
- Loan Setup Costs: Miscellaneous charges including application fees, property valuation fees, settlement fees, and mortgage registration fees.
Let us help you decide!
Still not sure how much deposit you need to buy your dream home? One of our Home Loan Experts can help you figure out.
To speak with one of our mortgage brokers, call 1300 889 743 or complete our free, no-obligation assessment form.