There is no single official deposit that every Australian buyer must save. The amount depends on the price of the home, what a lender will lend you, whether lenders mortgage insurance applies, and whether you can use a government scheme such as the 5% Deposit Scheme or Help to Buy.

ASIC's MoneySmart guidance is a useful starting point. The size of the deposit depends on the price of the home you want. You also need to cover other buying costs, such as stamp duty and legal fees. What you can borrow plays a part, because the more you can borrow, the less you need to save upfront. MoneySmart's method is: start with the property price, add the buying costs, subtract what you can borrow, and the balance is your deposit, which is your savings goal.

This is general information only. It is not personal advice, and it is not a loan offer.

The usual percentages, in plain terms

If the purchase price and the lender's valuation are the same:

  • a 20% deposit means you are borrowing 80% of the value. MoneySmart says LMI is usually payable when the amount borrowed exceeds 80%, so a 20% deposit is the common way to avoid that cost
  • a 10% deposit means a 90% loan, where LMI often applies on a standard loan
  • a 5% deposit means a 95% loan. MoneySmart says some lenders may accept a deposit as little as 5%, but a smaller deposit may mean higher costs such as LMI, unless a government scheme helps
  • a 2% deposit is the official minimum under Help to Buy, and under the 5% Deposit Scheme for eligible single parents and legal guardians

Those percentages describe the deposit on the property price. They do not include stamp duty, inspections, legal fees, loan fees, moving costs or insurance. A buyer who has exactly 10% of the price in the bank may still be short once those costs are added.

Lenders also care about where the money came from. Regular savings, sometimes called genuine savings, can be treated more favourably than a gift that arrives just before you apply, though policies differ. A grant that is only paid at settlement may not count as a deposit you already hold.

Worked cash examples

The loan figures below ignore interest-rate differences and assume the lender values the home at the purchase price. Add duty and fees on top, using the stamp duty calculator for your state or territory.

For a $600,000 home, which is also the figure MoneySmart uses in its LVR example:

  • 20% deposit: $120,000, loan $480,000, LVR 80%. LMI would often not apply.
  • 10% deposit: $60,000, loan $540,000, LVR 90%. LMI would often apply on a standard loan.
  • 5% deposit: $30,000, loan $570,000, LVR 95%. LMI would often apply unless you are eligible for a scheme that removes it.
  • MoneySmart's own LVR example on this price is a $450,000 loan, which is a 75% LVR and a $150,000 deposit.

For an $800,000 home in a location that is under the relevant scheme cap:

  • 20% deposit: $160,000, loan $640,000
  • 5% deposit: $40,000, loan $760,000, with no LMI under the 5% Deposit Scheme if you and the property are eligible
  • 2% deposit: $16,000, which is the official Help to Buy example on this price, together with a $544,000 loan and a $240,000 government equity contribution in that example

The 5% path saves $120,000 of cash up front compared with a 20% deposit on $800,000, but it leaves you with a loan that is $120,000 larger. Over 30 years, the extra interest can be substantial. Use the mortgage repayment calculator with the actual rate you are offered, not a rate copied from an advertisement.

Buying costs on top of the deposit

Budget separately for:

  • transfer duty, often called stamp duty, after any first-home concession or exemption. This can be one of the largest extra costs, or it can be reduced to zero for some eligible buyers, including, from 1 July 2026, eligible ACT buyers under the Home Buyer Concession Scheme
  • conveyancing or legal fees, and disbursements such as searches
  • building, pest and strata inspections
  • lender fees, valuation fees and, if it applies, LMI
  • moving costs, new-home setup and any immediate repairs
  • insurance, often required from exchange or settlement
  • a buffer, so a slightly lower valuation or a delayed grant payment does not sink the settlement

First home owner grants can offset some of this cash, but they are usually limited to new homes, they have value caps in most jurisdictions, and they may not be paid until settlement or a building milestone. Do not sign a contract that only works if a grant is approved, unless you have advice and a genuine fallback.

Government schemes that change the deposit you need

Three Commonwealth settings are easy to mix up:

  • The 5% Deposit Scheme is a guarantee. From 1 October 2025 the official pages say there are no income caps and no place limits. The minimum deposit is 5%, or 2% for eligible single parents and legal guardians, and there is no LMI. Location price caps apply, and both the price and the lender's valuation must be within the cap.
  • Help to Buy is shared equity. The minimum deposit is 2%. The government can contribute up to 30% of an existing home or 40% of a new home, income caps and a 10,000-place annual limit apply, and the government shares later gains and losses.
  • The First Home Super Saver Scheme does not change the lender's LVR on its own. It is a way to save voluntary contributions in super and withdraw them, within the $15,000 a year and $50,000 total limits, toward a deposit.

State and territory grants and duty concessions can sit alongside these, subject to each set of rules. The first home buyer checklist puts them in order.

What lenders look at besides the deposit

MoneySmart lists savings history, your credit report, income and expenses, employment, and whether you have a guarantor. The borrowing power calculator shows how a surplus and APRA's 3 percentage point serviceability buffer can be turned into an estimate of borrowing capacity. A strong deposit does not fix a serviceability shortfall, and a small deposit is harder to approve if your budget is already tight.

If a family member acts as guarantor, they may use their own home or savings to support your loan. If you cannot pay, the guarantor can be called on. That can reduce the cash deposit you have to save, but it transfers risk to someone else.

How to set a savings target

  1. Pick a realistic price range in the area you would actually buy, not a national average.
  2. Decide whether you are aiming to avoid LMI, to use a government scheme, or to keep both options open.
  3. Add buying costs, including duty after any concession you are genuinely likely to receive.
  4. Subtract any grant or FHSS amount only if you have checked the official rules and the timing of the payment.
  5. Compare the remaining cash with what you can save, using the savings goal calculator.
  6. Check that the implied loan is serviceable, not only that the deposit is reachable.

If the target is a long way off, changing the price range, the location, or the scheme you use usually moves the date more than squeezing an already tight budget. Waiting also has a cost, which is why the buying versus renting calculator is worth running with conservative assumptions.

Frequently asked questions

Is a 20% deposit required in Australia?

No. It is the common level for avoiding LMI when the valuation matches the price, not a legal minimum. Buyers regularly settle with smaller deposits, either by paying LMI or by using a government scheme or a guarantor.

Can I use a gift or a grant as my deposit?

Sometimes, depending on the lender and on when the money is available. Ask the lender how it treats gifts, and confirm with the revenue office when a grant can be paid. A scheme minimum of 5% or 2% still has to be met with funds the lender will accept.

Should I use my super for a deposit?

Only through a legal condition of release, such as the First Home Super Saver Scheme, or in other limited ATO circumstances. Withdrawing super outside those rules can have serious tax and retirement consequences. Read the FHSS explainer and the ATO pages before you contribute or apply for a release.

General information warning

This article is general information only. It is not personal financial product advice, and it is not a recommendation about how large a deposit you should save or which scheme you should use. It does not take into account your objectives, financial situation or needs. Lender policies, premiums and scheme rules change. Consider speaking with a licensed adviser and a lender, and confirm official scheme and duty figures before you sign a contract.

Sources

Last reviewed: November 2026.