Whether you’ve been saving for years, or you’re just starting to think about it – buying your first home can be an exciting and daunting prospect. There is a lot to think about, which is why we’ve put together this helpful guide on what first time home buyers need to know.
Do your research
Before diving in, spend time understanding the market and what will work for your lifestyle and budget. Look into:
- Location: Is the area right for your work, family, or lifestyle?
- Growth potential: Are there planned infrastructure projects or developments that might increase value?
- Community feel: Explore the neighbourhood to see if it suits your day-to-day life.
Attending open homes – even if you’re not ready to buy – can give you a realistic sense of property values and help you refine your expectations.
Saving for your deposit
A key step in buying your first home is understanding how much you can borrow. Lenders will take into account your income, savings, debts, and everyday expenses to determine your borrowing capacity. To get a clearer picture, you can use our home loan calculator to estimate potential repayments and see what you may be eligible for.
In most cases, your deposit will need to be between 5–10% of the property’s value, which provides a good guide to the minimum savings required. Once you’ve set a savings target, it’s helpful to create a realistic timeline for reaching it and set smaller, short-term goals to keep yourself motivated along the way. One simple strategy is to open a separate savings account that isn’t linked to your everyday account, so you’re less tempted to dip into your savings.
If saving for a deposit still feels out of reach, another option could be a Family Guarantee. This allows a family member to use the equity in their own property as additional security for your loan, reducing the size of the deposit you need. While a Family Guarantee can help you get into your first home sooner, it’s important to carefully consider the responsibilities and risks involved for both you and your guarantor.
Budgeting for extra costs
It’s important to remember that the costs of owning a home extend well beyond your deposit and loan repayments. As a first-time buyer, it’s easy to overlook upfront expenses like Lenders Mortgage Insurance (LMI), solicitor or conveyancer fees, and building inspections. Once you’ve moved in, there are also ongoing costs to factor in, including homeowners insurance, council rates, maintenance, and repairs. Allowing some extra room in your budget for these expenses will help you avoid financial stress and ensure you’re better prepared for the realities of home ownership.
Government support
From 1 October 2025, the Australian Government has updated its assistance programs:
- Australian Government 5% Deposit Scheme (previously the Home Guarantee Scheme): Eligible first-time buyers can purchase with as little as a 5% deposit without paying LMI.
- First Home Owner Grant (FHOG): A one-off payment for those buying or building their first home. Grant amounts vary by state and territory and are usually paid at settlement.
It’s worth checking both your eligibility and your state’s specific conditions, as these programs can significantly reduce the upfront costs of buying.
Choosing your home loan
Choosing the right home loan is about finding a balance between your needs, budget, and lifestyle. A fixed rate loan can provide certainty by locking in your repayments for a set period, which protects you from interest rate rises and can give peace of mind when planning your finances.
On the other hand, a variable rate loan offers greater flexibility. Your repayments will fluctuate as interest rates move, which can work in your favour if rates fall, but it also means you’ll pay more if they rise.
If you’d like a combination of both, a split loan allows you to fix part of your loan while keeping the rest variable. This way, you can enjoy the security of predictable repayments on one portion while still taking advantage of potential savings if rates go down.
Making an offer
Once you’ve found the right home and arranged your finance, the next step is making an offer. Before doing so, it’s important to have the contract of sale reviewed by your solicitor or conveyancer to ensure everything is in order. If you’re satisfied, you can then submit your written offer to the agent or seller. From there, you may need to negotiate until both parties agree on a final price.
When your offer is accepted, you’ll move on to signing and exchanging contracts and paying your deposit. This is followed by the settlement period outlined in your contract, at the end of which you’ll pay the balance of the purchase using your home loan.
Buying your first home involves many steps, but the effort is well worth it when the day finally arrives to collect your keys and move in. Our friendly team is more than happy to guide you on every step of the way. Enquire today to begin your journey to becoming a first time home owner.
This article is intended to provide general information of an educational nature only. It does not have regard to your objectives, financial situation or needs and must not be relied upon as financial product advice. Before you act on this information, you should consider whether it is appropriate for your circumstances. Applications subject to credit approval and fees and charges are payable. Terms and conditions apply and are available on request. Information in this article is current as at the date of publication.
