How much deposit do you need for a house in Australia?
Last checked
As at Next checkA 20% deposit usually avoids lenders mortgage insurance. Government schemes can let eligible buyers start from 5% or 2%.
- 20% deposit: usually no lenders mortgage insurance (LMI)
- 5% deposit: no LMI under the 5% Deposit Scheme, if eligible
- 2% deposit: Help to Buy, or single parents under the 5% scheme
- Upfront costs such as stamp duty come on top
Deposit and upfront costs estimator
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Deposit or upfront costs: what is the difference?
The deposit is the part of the price you pay yourself. Moneysmart suggests saving 20% of the price, plus enough to cover buying costs.[1] Those costs come on top:
- Stamp duty, unless a first home concession applies. Each state sets its own (see our state tracker).[1]
- Legal or conveyancing fees for checking the contract and settling.[1]
- Building and pest inspections.[1]
- Home insurance, which a lender may make a condition of the loan.[1]
- Lenders mortgage insurance if you borrow more than 80% of the value.[2]
At an auction, expect to pay a deposit straight away, for example 10% of the price.[1]
Ways to buy with a smaller deposit
- The 5% Deposit Scheme. Eligible first home buyers can buy with 5% without LMI. Eligible single parents can start from 2%.[4][5]
- Help to Buy. Your deposit can be 2%. The government pays up to 40% of a new home and owns that share.[6]
- A family guarantee. A guarantor uses part of their own property as security for your loan. They take on financial risk if you cannot repay.[3]
- State grants and duty concessions. These can lower the cash you need on a new home. Check your state.
Moneysmart suggests everyone in a family guarantee gets their own legal advice first.[3]
Can I buy a house with no deposit?
Not through the federal schemes: the smallest deposit they allow is 2%, through Help to Buy or the 5% Deposit Scheme's single parent option.[6][5] Some buyers use a family guarantee instead. Moneysmart says it can sometimes cover part of the loan, such as the deposit.[3] The guarantor takes on real risk. If you cannot repay, they may have to repay the whole loan, and the lender may sell their home.[8] Stamp duty, legal fees and inspections still come on top.[1]
A general example: a $700,000 home in Melbourne
- 20% deposit: $140,000. That usually avoids LMI.[1][2]
- 5% deposit: $35,000. $700,000 is under the $950,000 5% Deposit Scheme cap for Melbourne.[5]
- 2% deposit: $14,000, through Help to Buy. The Melbourne cap is $950,000.[7]
- Stamp duty: reduced, not removed, for an eligible first home buyer. $700,000 is between $600,001 and $750,000.
- Grant: the $10,000 Victorian grant may apply only if the home is new.
This is a general example, not a quote. It uses no interest rate or repayment figure. The Victorian figures are from our Victoria guide.
Find out which route fits your deposit.
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Worth weighing up
- A smaller deposit means a bigger loan, so you pay interest on more money for longer.
- LMI can add a large cost to a low-deposit loan. It protects the lender, not you.
- With little equity, a fall in values could leave you owing more than the home is worth.
- Zafar compares loans from his lender panel, not the whole market.
General information only. It does not take into account your objectives, financial situation or needs, and it is not a recommendation to enter into any credit contract. Eligibility is decided by the scheme administrator, the revenue office and the lender.
What changed
- : Page and estimator created. Federal caps as at 13 Oct 2026; state rules from the tracker.
Not sure which deposit route fits?
Zafar can check the schemes and state rules against your situation, and which lenders on his panel take part.
Ask Zafar to check Call 0402 357 860
See also: home loan pre-approval and the borrowing power calculator.
Sources
- Moneysmart (ASIC), Buying a house. Retrieved .
- Moneysmart (ASIC), Lenders mortgage insurance (LMI). Retrieved .
- Moneysmart (ASIC), Ways to buy a home sooner. Retrieved .
- Housing Australia (firsthomebuyers.gov.au), Australian Government 5% Deposit Scheme. Retrieved .
- Housing Australia (firsthomebuyers.gov.au), Australian Government 5% Deposit Scheme fact sheet (headed 1 July 2026). Retrieved .
- Housing Australia (firsthomebuyers.gov.au), Australian Government Help to Buy Scheme. Retrieved .
- Housing Australia (firsthomebuyers.gov.au), Help to Buy property price caps. Retrieved .
- Moneysmart (ASIC), Going guarantor on a loan. Retrieved .
Common questions
How much deposit do I need to buy a $700,000 house?
20% is $140,000, which usually avoids lenders mortgage insurance. 5% is $35,000, and 2% is $14,000 through Help to Buy where eligible. Stamp duty and other costs come on top.
How much deposit do I need for a $500,000 home?
20% is $100,000, which usually avoids lenders mortgage insurance. 5% is $25,000, with no LMI under the 5% Deposit Scheme if you are eligible. 2% is $10,000, through Help to Buy or the scheme's single parent option where eligible. Stamp duty and other upfront costs come on top.
Can I buy a house with a 5% deposit without LMI?
Yes, if you are eligible for the 5% Deposit Scheme and use a participating lender. The price must be under the cap for the area. Otherwise LMI usually applies.
Is a 10% deposit enough?
It can be, if a lender accepts it. You would borrow 90% of the value, so lenders mortgage insurance usually applies. Upfront costs come on top.
Does my deposit have to cover stamp duty too?
Stamp duty is a separate cost on top of the deposit, unless a first home concession removes it. Legal fees and inspections also come on top.
Talk to Zafar
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