A 5% deposit is not a 5% cash target | Home In Australia

Australia’s 5% Deposit Scheme has expanded. Eligible first-home buyers may be able to purchase with a deposit as low as 5% and avoid Lenders Mortgage Insurance. Places are uncapped and income caps have been removed, but buyer eligibility, property price caps, participating-lender rules and normal credit assessment still apply.

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That can lower the entry barrier. It does not mean the full cash target is only 5% of the property price.

Before buying, separate four amounts:

1. Deposit

This goes towards the purchase price. A smaller deposit usually means a larger loan, so test the repayment and total interest rather than looking at entry cash alone.

2. Purchase costs

Stamp duty or concessions, transfer and registration charges, and lender-related fees vary by state, property price and personal circumstances. Use figures that apply to your own purchase.

3. Professional checks

Allow for a solicitor or conveyancer, building and pest inspection, strata report, and any valuation or extra investigation needed before you commit.

4. Post-settlement buffer

Moving, insurance, settlement adjustments, essential furniture, early repairs and the first repayment period can arrive close together. Settlement day should not be the day your available cash reaches zero.

Your Monday calculation is:

Full cash target

= deposit + purchase costs + professional checks + buffer

Subtract the savings you can actually use. The result is the real gap to plan for.

A 5% deposit may help you enter sooner. A complete cash plan helps you stay comfortable after the keys arrive.

*General information only. This is not financial advice. Loan options and eligibility depend on your personal income, liabilities, assets and lender assessment criteria.