How to Buy Your First Home in Australia 2026

Buying your first home in Australia in 2026 is one of the biggest financial decisions you will ever make, and with the right preparation, it is entirely achievable — even in a challenging market. From saving your deposit to getting the keys, understanding every step of the process gives you confidence and saves thousands of dollars.

Understanding First Home Buyer Grants and Schemes

The Australian and state governments offer a range of schemes specifically designed to help first home buyers enter the market sooner. Taking full advantage of these can significantly reduce your upfront costs.

Federal Government Schemes:

Scheme	Benefit	Income Limit
First Home Guarantee (FHBG)	Buy with 5% deposit, no LMI	$125,000 singles / $200,000 couples
Regional First Home Buyer Guarantee	5% deposit in regional areas, no LMI	Same as FHBG
Help to Buy (shared equity)	Government co-purchases up to 40% of property	$90,000 singles / $120,000 couples

State-based First Home Owner Grants (FHOG):

State	Grant Amount	Conditions
NSW	$10,000	New homes up to $600,000
VIC	$10,000	Regional areas; $10,000 metro for new builds
QLD	$30,000	New homes, owner-occupier
WA	$10,000	New homes only
SA	$15,000	New homes
TAS	$10,000	New homes
ACT	No FHOG	Stamp duty concession instead
NT	$10,000	New or substantially renovated

Stamp duty (transfer duty) concessions for first home buyers are also available in every state. In some states such as Victoria and NSW, eligible first home buyers pay no stamp duty at all on properties below certain price thresholds.

Saving Your Deposit: How Much Do You Really Need?

Before you start saving, check your credit score — lenders assess it carefully during the mortgage application process. Our guide on how to improve your credit score in Australia will help you maximise your chances of approval. Use our mortgage calculator to estimate your repayments at different deposit levels.

The standard deposit for a home loan in Australia is 20% of the purchase price. At this level, you avoid Lenders Mortgage Insurance (LMI), which can add tens of thousands of dollars to your loan costs.

However, thanks to government schemes, you can buy with as little as 5% if you qualify. Here is what different deposit levels look like on a $700,000 home:

Deposit	Amount	LMI Required?
5%	$35,000	Yes (unless using FHBG scheme)
10%	$70,000	Yes
20%	$140,000	No

Beyond your deposit, budget for:

Stamp duty (varies by state and property price)
Legal/conveyancing fees: $1,500–$3,000
Building and pest inspection: $400–$800
Loan application fees: $0–$600
Moving costs: $500–$3,000
Council and water rates (upfront or ongoing)

Strategies to save faster:

Open a dedicated First Home Super Saver (FHSS) account — you can save up to $50,000 in concessional super contributions and withdraw for a deposit with tax advantages
Cut discretionary spending and automate savings transfers on payday
Consider living with family temporarily to accelerate saving

Getting Pre-Approved for a Home Loan

Before you start attending open homes, get a conditional pre-approval from a lender. Pre-approval tells you how much you can borrow and shows sellers you are a serious buyer.

What lenders assess:

Income — payslips, tax returns, PAYG summaries
Existing debts — credit cards, personal loans, car finance
Savings history — typically 3–6 months of genuine savings
Credit history — check your credit score before applying
Living expenses — lenders scrutinise spending habits closely

Compare lenders:

Major banks (CBA, Westpac, ANZ, NAB) offer stability and branch access
Online lenders and credit unions often have lower rates
A mortgage broker can compare dozens of lenders for free

Pre-approvals are typically valid for 90 days and can usually be extended. Do not apply with multiple lenders simultaneously — multiple credit inquiries can lower your credit score.

The Home Search Process

Once pre-approved, you can begin your property search with a clear budget in mind.

Key steps:

Set your non-negotiables vs nice-to-haves (bedrooms, location, land size, proximity to schools)
Attend multiple open homes to understand market pricing
Research comparable sales (comps) on platforms like Domain and realestate.com.au
Consider engaging a buyer’s agent, especially in competitive markets
Register for alerts on property portals so you never miss a new listing

When you find a property you like, act quickly. In most Australian capital cities, desirable properties sell within days. Arrange a building and pest inspection before making an offer or bidding at auction.

Making an Offer and the Conveyancing Process

Once your offer is accepted (or you win at auction), the legal process begins. It’s also a good time to ensure your estate planning is in order — see our guide on how to make a will in Australia once you become a property owner. If you’re also considering investment properties, our best cities to invest in property in Australia guide is essential reading. This is handled by a conveyancer or solicitor.

Private treaty (offer and negotiation):

You make a written offer to the vendor
The vendor accepts, rejects, or counters
Once agreed, contracts are exchanged and a deposit (typically 10%) is paid
A cooling-off period of 2–5 days applies in most states (not applicable after auction)

Auction:

No cooling-off period — if you bid and win, you are legally bound
You must have your finance and inspections arranged before auction day
The full 10% deposit is payable immediately on the fall of the hammer

Conveyancing steps after exchange:

Your conveyancer reviews the contract and conducts title searches
Your lender arranges formal loan approval and valuation
A settlement date is agreed (typically 30–90 days after exchange)
On settlement day, funds are transferred and the title is transferred to your name

What Happens on Settlement Day

Settlement day is the day you officially become a homeowner. Your lender transfers the loan funds, the vendor’s mortgage is discharged, and the title is transferred to your name.

Your conveyancer or solicitor manages the settlement process on your behalf
You do a final inspection of the property before settlement (strongly recommended)
You receive keys and can move in immediately after settlement is confirmed
Your council rates, strata levies, and other costs adjust from settlement date

Celebrate — but remember to budget for the first few months as a homeowner. You will have mortgage repayments, council rates, insurance, and maintenance costs to manage from day one.

Frequently Asked Questions

Q: What is the minimum deposit needed to buy a house in Australia?

A: With the First Home Guarantee scheme, eligible buyers can purchase with as little as 5% deposit without paying Lenders Mortgage Insurance. Without the scheme, a 20% deposit avoids LMI, though buyers can purchase with less using LMI.

Q: How does the First Home Owner Grant work?

A: The FHOG is a one-off cash payment from the state government available to eligible first home buyers purchasing or building a new home. The amount varies by state — from $10,000 to $30,000. It is typically paid at settlement or the first progress payment stage for construction.

Q: Can I use my superannuation for a house deposit?

A: Yes, through the First Home Super Saver Scheme. You can make voluntary contributions to your super and later withdraw up to $50,000 (plus associated earnings) for a first home deposit. This can provide a significant tax advantage over saving in a regular account.

Q: Do I need a solicitor or conveyancer to buy a house?

A: You do not legally need one, but it is strongly recommended. A conveyancer or solicitor reviews the contract, conducts title searches, advises on any issues, and manages the settlement process. Their fee is a small fraction of the protection they provide.

Q: What is Lenders Mortgage Insurance?

A: LMI is insurance that protects the lender (not you) if you default on your home loan with a deposit below 20%. It can cost anywhere from $5,000 to $30,000+ depending on your deposit and loan size. The First Home Guarantee scheme allows eligible buyers to avoid LMI with a 5% deposit.

Q: How long does buying a house take from start to finish?

A: The timeline varies widely. Saving a deposit can take 3–7 years. Once you begin actively searching, finding the right property might take 2–6 months. After exchange of contracts, settlement typically takes 30–90 days. Budget at least 6–12 months from serious searching to settlement.

Q: Should I buy at auction or through private treaty?

A: Both have pros and cons. Auctions are unconditional — once you bid and win, there is no cooling-off period, so your finances and inspections must be completed beforehand. Private treaty gives you more negotiating time and a cooling-off period in most states. Auctions are common in Melbourne and Sydney; private treaty is more prevalent elsewhere.

Q: What ongoing costs should I budget for as a first homeowner?

A: Beyond mortgage repayments, budget for council rates ($1,000–$3,000/year), water rates ($600–$1,200/year), home and contents insurance ($1,000–$2,500/year), strata levies if applicable, maintenance and repairs (budget 1% of property value per year), and land tax if applicable.