Last Updated: 28th April, 2023

Buy Now Or Save More Calculator

Loan details

How big is your deposit? ?
What is your purchase price? ?
Where are you buying?
How much rent are you paying? ?
How much can you save? ?

Is it better to buy a home now or to save a larger deposit?

By saving a 20% deposit, you can avoid paying Lenders Mortgage Insurance (LMI) but you’ll pay more in rent by delaying your purchase. In the meantime, house prices may grow out of your reach.

Find out which option is best for you using our simple calculator above.

Tips for using this calculator

Are the properties in your area increasing in value? The long term average growth for most capital city locations is around 8% per annum. Our calculator will use the average growth in your state over the last 25 or 50 years.

Hover your mouse over the ‘?’ icons in our calculators to find additional information on using the calculator.

When is it better to save rather than buy?

It’s worth pointing out that having a bigger deposit (low LVR home loan) will give you the best deal on your home loan. But waiting to save up that extra cash may not always be feasible.

In most cases, you’ll find that it makes more sense to buy now rather than to save a larger deposit. It is because the cost of LMI is typically much less than the growth rate of a property.

However, if your local area isn’t increasing in value, there’s no harm in waiting. You can delay your purchase until you are sure about your financial position. Just make sure you have a savings plan and stick to it!

If the market is falling, then, of course, don’t buy!

Waiting will obviously leave you in a better position but try not to listen to the media. Instead, you can determine the market direction by looking at reliable sources such as RP Data, Residex and Australian Property Monitors (APM).

Our mortgage brokers have a paid subscription to APM, and if you’re one of our clients, we can provide you with free property reports and data. Please call us on 1300 889 743 or enquire online to find out more.

How can I find the lowest LMI premium?

Not every lender has the same LMI premium rates. So, we’ve created a mortgage insurance calculator which compares lenders and lets you know if you’re eligible for any LMI discounts/waivers.

Can I borrow 100% with no LMI?

Yes, you can. However, you’ll need the support of your parents to guarantee your loan. The lender will use your parents property as additional security for your loan so you won’t have to pay LMI.

You can read more about this option on our guarantor mortgage page.

In addition, the very in-demand federal government’s First Home Loan Deposit Scheme allows first home buyers to borrow up to 95% of the property value without paying LMI.

Apply for a home loan today

We can find out which lenders can approve your loan.

Speak to one of our expert mortgage brokers by calling 1300 889 743 or enquire online today.