How can you buy a home with a 5% deposit and pay no LMI?

Some professionals may qualify for a 5%-deposit LMI waiver with certain banks, while eligible buyers can use the Home Guarantee Scheme programs (First Home Guarantee, Regional First Home Buyer Guarantee or Family Home Guarantee) to purchase with a 2-5% deposit and avoid LMI.

What do lenders accept as a deposit and genuine savings?

Lenders generally require at least 5% of the loan amount in genuine savings that have been in your bank account for at least three months. They will review your bank statements to confirm the funds were accrued over time.

When and how do you pay your house deposit?

Most buyers pay the deposit by bank transfer. For a private sale you usually pay a small holding deposit ($1,000-$3,000) first and the balance after signing the contract. At auction you may need to pay 5-10% of the winning bid on the day.

How Much Do You Need For A House Deposit In 2026?

Q: What’s the minimum deposit required to buy a house in Australia?

Most lenders (including the big four banks) will accept a minimum deposit of 5% of the property’s value if you pay lender’s mortgage insurance (LMI). In practical terms, you would need a $30,000 deposit to buy a $600,000 home and borrow $570,000 from the bank.

Q: What’s the average home loan deposit in Australia?

The average first-home buyer deposit is about $131,500, based on the average owner-occupier loan of $526,000 and a 20% deposit, according to Money.com.au’s latest Mortgage Insights report.

Q: How much deposit do you need with a guarantor?

With a guarantor home loan you may be able to buy with little or even zero deposit. A parent or family member can use their home equity to secure up to 20% of your loan to reduce your LVR to 80% and avoid LMI, or secure the full loan amount.

Q: How much deposit do you need when using equity to buy another property?

If you’re buying a second property you can use equity in your existing home as the deposit, provided you have at least 20% usable equity to keep your new LVR at 80% and avoid LMI. Otherwise you’ll need to contribute enough cash to reach that 20% threshold.

Q: Can you use the First Home Owner Grant as part of your home loan deposit?

Yes, the First Home Owner Grant (FHOG) can be counted toward your deposit, but lenders still want at least 5% of the property’s value in genuine savings. The FHOG can’t be the sole source of your deposit.

Q: Do lenders accept cash gifts or inheritance as a deposit?

Yes. Gifted deposits and inheritance are acceptable, but lenders will ask for proof of origin — a signed gift letter for cash gifts or estate documents for inheritance.

Q: What is a deposit bond?

A deposit bond is an insurance policy that guarantees you’ll pay the deposit at settlement. It can be useful if your funds are tied up, but not all lenders offer or accept deposit bonds.

How Much Do You Need for a House Deposit?

Home buyers should aim for a 20% deposit to secure the best loan rates and terms, but it's possible to buy a property with a deposit as low as 5%, or even 2% in some situations.

The average home deposit in Australia is around $173,000

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Our dedicated team of Money.com.au Home Loan experts is here to help. Updated 19 Aug 2026.

What’s the minimum deposit required to buy a house in Australia?

Most lenders (including the big four banks) will accept a minimum deposit of 5% of the property’s value, if you pay for lender’s mortgage insurance (LMI) or are eligible to use the First Home Guarantee (FHG) scheme.

In practical terms, you would need a minimum deposit of $30,000 to buy a $600,000 home and borrow $570,000 from the bank.

Here’s an overview of the common house deposit amounts and when they typically apply:

20% deposit: You generally need a deposit of at least 20% of the property’s value to avoid LMI if you don’t otherwise qualify for an exemption. This means a maximum loan-to-value ratio (LVR) of 80%. Lenders usually consider loans with an LVR over 80% of the property value to be a higher risk.

10% deposit: Some lenders may require a minimum 10% deposit with LMI. You’ll need a strong application for this type of loan, which means having a good credit score, a steady income and solid employment history.

5% deposit: A 5% deposit is the minimum for a lot of lenders in most situations (with LMI added to your loan). It’s also the minimum deposit needed for the more widely available government schemes, such as the First Home Guarantee (FHBG) and the Regional First Home Buyer Guarantee (RFHBG). These schemes allow you to buy a home with a 5% deposit and avoid LMI.

2% minimum deposit: If you qualify, you may be able to buy a home with as little as a 2% deposit through the Family Home Guarantee (FHG), and avoid paying LMI. However, this scheme is only available to single parents who meet specific eligibility criteria.

0% deposit: It is possible to buy a property using the equity in your home without needing a deposit. Existing homeowners often access their equity for various reasons, such as purchasing a second home or an investment property.

This table shows how much you would need for different levels of deposit based on different property values.

Property value	$500,000
20% deposit (no LMI)	$100,000
10% deposit (LMI may apply)	$50,000
5% deposit (LMI may apply)	$25,000
Property value	$600,000
20% deposit (no LMI)	$120,000
10% deposit (LMI may apply)	$60,000
5% deposit (LMI may apply)	$30,000
Property value	$700,000
20% deposit (no LMI)	$140,000
10% deposit (LMI may apply)	$70,000
5% deposit (LMI may apply)	$35,000
Property value	$800,000
20% deposit (no LMI)	$160,000
10% deposit (LMI may apply)	$80,000
5% deposit (LMI may apply)	$40,000
Property value	$900,000
20% deposit (no LMI)	$180,000
10% deposit (LMI may apply)	$90,000
5% deposit (LMI may apply)	$45,000
Property value	$1,000,000
20% deposit (no LMI)	$200,000
10% deposit (LMI may apply)	$100,000
5% deposit (LMI may apply)	$50,000

Property value	20% deposit (no LMI)	10% deposit (LMI may apply)	5% deposit (LMI may apply)
$500,000	$100,000	$50,000	$25,000
$600,000	$120,000	$60,000	$30,000
$700,000	$140,000	$70,000	$35,000
$800,000	$160,000	$80,000	$40,000
$900,000	$180,000	$90,000	$45,000
$1,000,000	$200,000	$100,000	$50,000

The bigger your deposit, the lower your LVR and the less you have to borrow. A larger deposit shows lenders you have a proven savings history and can mean you get a better interest rate on your home loan.

What’s the average home loan deposit in Australia?

The average home loan deposit in Australia in 2026 is $173,000, according to Money.com.au’s analysis of more than 20,000 borrowers.

Not surprisingly, home deposits are highest in New South Wales, where home buyers have saved more than $206,000 on average, while borrowers in the Northern Territory require the smallest home deposits (just over $99,000).

The table below shows the average home deposit across Australia.

Location	Australia (all)
Average home deposit	$172,791
Location	NSW
Average home deposit	$206,256
Location	ACT
Average home deposit	$178,648
Location	Qld
Average home deposit	$158,832
Location	WA
Average home deposit	$151,474
Location	Vic
Average home deposit	$151,382
Location	Tas
Average home deposit	$124,421
Location	SA
Average home deposit	$122,276
Location	NT
Average home deposit	$99,179

Location	Average home deposit
Australia (all)	$172,791
NSW	$206,256
ACT	$178,648
Qld	$158,832
WA	$151,474
Vic	$151,382
Tas	$124,421
SA	$122,276
NT	$99,179

Source: Money.com.au analysis from January 2026, based on enquiries received in the previous year.

We recently asked Australians whether they had at least 5% of their first home’s value saved as genuine savings when they bought their property. Of our survey respondents, 39.6% said they did, while 25.2% of Aussies had saved 10% or more, and 23.4% had saved 20% or more.

New research from Money.com.au reveals that two in five young Australians (42%) aged under 30 years old have missed an important family or social event while saving for a home deposit, with one in five (20%) having skipped a wedding. By comparison, just 27% of Australians overall didn't attend an important personal event while saving for a deposit.

Here’s the difference in interest rates for standard owner-occupied home loans with a 20% deposit (80% LVR) and a 5% deposit (95% LVR) from popular lenders in Australia.

Lender	ING Mortgage Simplifier
Interest rate at 80% LVR	6.04% p.a.
Comparison rate^	6.07% p.a.
Interest rate at 95% LVR	6.69% p.a.
Comparison rate^	6.72% p.a.
Lender	St.George Basic Home Loan
Interest rate at 80% LVR	6.39% p.a.
Comparison rate^	6.40% p.a.
Interest rate at 95% LVR	6.69% p.a.
Comparison rate^	6.70% p.a.
Lender	Commonwealth Bank Standard Variable Rate Home Loan (with Wealth Package)
Interest rate at 80% LVR	6.49% p.a.
Comparison rate^	6.87% p.a.
Interest rate at 95% LVR	7.74% p.a.
Comparison rate^	8.10% p.a.
Lender	ANZ Simplicity PLUS Home Loan
Interest rate at 80% LVR	6.54% p.a.
Comparison rate^	6.54% p.a.
Interest rate at 95% LVR	7.64% p.a.
Comparison rate^	7.64% p.a.

Lender	Interest rate at 80% LVR	Comparison rate^	Interest rate at 95% LVR	Comparison rate^
ING Mortgage Simplifier	6.04% p.a.	6.07% p.a.	6.69% p.a.	6.72% p.a.
St.George Basic Home Loan	6.39% p.a.	6.40% p.a.	6.69% p.a.	6.70% p.a.
Commonwealth Bank Standard Variable Rate Home Loan (with Wealth Package)	6.49% p.a.	6.87% p.a.	7.74% p.a.	8.10% p.a.
ANZ Simplicity PLUS Home Loan	6.54% p.a.	6.54% p.a.	7.64% p.a.	7.64% p.a.

^Comparison rates are calculated based on a loan amount of $150,000 repaid over a 25-year term. Rates are current as of 14 August 2026.

How much deposit do you need with a guarantor?

You may be able to buy a home in Australia with little to zero deposit with a guarantor home loan. With this option, a parent or family member can use their home equity to help secure your loan, either instead of or in addition to your cash deposit.

Your guarantor must be a homeowner and have enough equity to secure your home loan. A guarantor may secure a portion of your loan – usually 20% to reduce your LVR to 80% (and avoid LMI) or the full loan amount.

Keep in mind that if your guarantor’s mortgage is with a different lender, they will need approval from that lender to add a second mortgagee (your lender) to the title of their property.

How much deposit do you need when using equity to buy another property?

If you’re buying a second property, you may be able to use equity in your existing property as a deposit, meaning you wouldn’t have to put any money down.

The catch is that you need at least 20% usable equity in your home to refinance and avoid paying LMI on a new loan. Usable equity is the equity in your home you can borrow against – usually 80% of the property’s value minus your outstanding debt. The lender will conduct a property appraisal to determine exactly how much usable equity you have.

If you only have 15% usable equity in your home, you’d need to contribute a 5% cash deposit to avoid LMI. The best way to do this is with a ‘cash out’ refinance, which allows you to access your usable equity in cash and then contribute some of your own money to reduce your LVR to 80%, according to Westpac.

How to buy a home with a 5% deposit and pay no LMI

LMI waiver

Some banks and lenders may waive LMI on home loans with a 5% deposit for professionals in certain secure or high-paying industries – commonly legal and medical practitioners, finance and accounting professionals, etc. Banks that offer an LMI waiver for professionals include ANZ, NAB and Westpac.

Government support

The Home Guarantee Scheme (HGS) is available Australia-wide through participating lenders to support eligible first-home buyers and single parents to buy a property with a deposit as little as 2-5%. Housing Australia guarantees up to 15% of the value of a first home and up to 18% for single parents or guardians to avoid the need for LMI.

These include:

First Home Guarantee (FHBG)
For eligible first-home buyers to buy a home with a deposit starting from 5% with no LMI. From 1 October 2025, there are no limits on the number of places available, no income caps, and higher property price caps based on your city. For buyers outside capital cities, the Regional First Home Buyer Guarantee has now been replaced by the FHBG.
Family Home Guarantee (FHG)
For eligible single parents or single legal guardians of at least one dependent to buy a home with a deposit starting from 2% with no LMI. There are 5,000 places available for the 2025-26 financial year.

Can you use the First Home Owner Grant as part of your home loan deposit?

Lenders generally require a minimum of 5% of the property’s value in genuine savings. Your First Home Owner Grant (FHOG) can contribute to your deposit, but it can’t be the sole source of it, according to mortgage brokers we spoke to. In other words, lenders prefer to see that you've saved money on your own, which shows them you're financially responsible and committed to the purchase.

Some lenders (like Unloan) don't accept FHOG funds as part of your deposit, but being eligible for it may still help you when applying for a loan. According to ANZ, lenders may still factor in the one-time payment when assessing your borrowing capacity, pending grant approval.

There are conditions to the kinds of funds lenders will accept as a deposit. As a general rule, lenders will require at least 5% of the loan amount in genuine savings.

Money.com.au Senior Mortgage Broker, Nick Burgess said lenders will generally check your bank statements to check that your deposit has been accrued over time and sitting in a bank account for at least three months.

Nick Burgess, Mortgage Broker at Money.com.au

Nick Burgess, Money.com.au's Senior Mortgage Broker

“If you’re saving for a house deposit, the first thing you should do is run an analysis on exactly what you’re spending your salary on. I think most people will be surprised how much they spend on small things like a daily coffee or lunch that can add up over time. If you could save even $10 a day, it could add up to $3,500 a year and that’s about 11% of a 5% ($30,000) deposit for a $600,000 home loan. Get serious about cutting your discretionary spending by half.”

Nick Burgess, Money.com.au's Senior Mortgage Broker

Do lenders accept cash gifts or inheritance as a deposit?

Lenders will generally still accept gifted deposits, usually from parents or family or an inheritance. But they will ask for evidence of where the money came from.

For cash gifts, they may require a gift letter signed by your benefactor(s) stating the funds were given to you as a gift with no strings attached.

For an inheritance, they may require a letter of validation from the executor of the will confirming the amount you’re set to inherit, a copy of the will and a grant probate confirming the will is valid.

When and how to pay your house deposit

The most common way to pay your house deposit is via bank transfer, according to Westpac. The lender will generally add your deposit to your home loan account before you proceed with your property sale.

As for when your deposit needs to be paid, it will depend on how you’re buying the property:

Private sale

You generally have to pay your deposit in two parts when you buy a home in a private treaty sale, according to Westpac. You pay a smaller holding deposit between $1,000 and $3,000 (negotiable with the real estate agent or buyer) to show that you're serious about the purchase and the remainder of the deposit after you’ve signed the contract of sale to buy your property.

Auction

If you’re buying a property at auction, you may be required to pay some of your deposit on the day – usually 5-10% of the winning bid.

What is a deposit bond?

If your deposit is tied up in other assets or investments, you may be able to use a deposit bond instead. A deposit bond is an insurance policy that guarantees you will pay a deposit at settlement or by the agreed period stated in the policy document. Not all lenders offer or accept deposit bonds.

When you’re trying to work out how much you need to save for your deposit, don’t forget to factor in upfront costs and relevant home loan fees.

Stamp duty

Stamp duty is a state government tax on property purchases and title transfers. It’s calculated as a percentage of the property’s value, ranging from 3-5%. Stamp duty rates vary depending on:

Your state or territory

Whether you’re a first-home buyer

Whether you’re buying vacant land

Whether you’re buying an investment property

The price of the property

Use our stamp duty calculator to estimate your costs. Stamp duty concessions or exemptions apply to eligible first-home buyers in most states.

Mortgage registration fees

Your state or territory government will charge you mortgage registration fees to register your mortgage on a property title. This registers your property as the security on the home loan, allowing future buyers or lenders to check any claims on the home. Mortgage registration fees are payable when the loan is established.

Legal and conveyancing fees

When you buy a home, you’ll usually need to engage a conveyancer or solicitor to handle all the legal paperwork and processes, like transferring the property title to your name, etc. Conveyancing fees can range between $1,200 and $2,400.

Building and pest inspection

It’s always best to conduct a building and pest inspection before you sign the contract to buy your home. This final check (although not mandatory) ensures that the property is structurally sound and has no pest problems like a termite infestation. Building and pest inspections combined can cost between $200 and $1,000, depending on the size of the property and your location.

Moving costs

If you’re buying a home to live in, you may have to hire a removalist which could cost upwards of $1,000 for the service, depending on how much furniture you have, mileage, and if you require additional boxing and wrapping. It’s a good idea to compare quotes from different companies and read online reviews before you hire professionals.

Home insurance

You may be required to take out home insurance as a condition of your home loan agreement. Home insurance is designed to cover the costs of repairing or rebuilding your house if it’s destroyed or damaged by an insured event (e.g. fire, flood, vandalism, etc.). Home insurance can cost between $1,000 and $3,000 a year, depending on your level of cover and insurer.

Depending on the local rules in your state and your sale contract, you might become liable for insuring the property before the sale is settled and you actually move in. For example, in Queensland the buyer becomes responsible for the property from 5pm on the day after the contract date.

First home buyer guides & resources

Our home loan guides will help you navigate the road ahead.

Help for first home buyers

Knowing the process

Your options explained

Jargon busters

More House Deposit FAQs

How much deposit do I need to buy a house in Australia?

Most lenders require a minimum deposit of 5%, though some government schemes let you buy with even less. A 20% deposit helps you avoid Lender’s Mortgage Insurance (LMI), but if you don’t have that much, a guarantor (like a family member) can help you dodge it.

Can I buy a house with no deposit?

You typically can’t buy with a 0% deposit unless you have a guarantor who secures the loan with their property. Most lenders still require evidence of genuine savings. Government schemes don’t offer 0% deposit loans, but may reduce the amount needed – usually to 2–5%, not zero.

What’s the minimum deposit for a first home buyer?

First home buyers can purchase with as little as 5% under the First Home Guarantee, or 2% through the Family Home Guarantee (for eligible single parents), though places are limited. With a guarantor, you may not need a deposit at all, as they can secure up to 20% of the property’s value using their own home.

What is Lender’s Mortgage Insurance (LMI)?

LMI is a one-off premium charged when your deposit is less than 20% of the property’s value. It protects the lender, not you, if you default on the loan. LMI can cost several thousand dollars, depending on your deposit size, loan amount and lender.

How can I avoid paying LMI?

To avoid LMI, you’ll generally need a 20% deposit. Alternatively, you could qualify for a government scheme like the First Home Guarantee, which lets eligible buyers purchase with a smaller deposit and no LMI. You can also avoid it by using a guarantor loan, where a family member secures part of your loan.

Can I use my super for a house deposit?

Yes – under the First Home Super Saver Scheme (FHSSS), eligible first home buyers can withdraw up to $50,000 of voluntary super contributions (plus earnings) to put towards a deposit. You can’t withdraw your employer’s compulsory contributions. It’s best to speak with a financial adviser before proceeding.

Is it better to save a 20% deposit before buying?

Generally, a 20% deposit helps you avoid LMI, access better rates, plus it reduces your loan size, meaning less interest charged. But in a rising market, waiting too long could see prices outpace your savings. In some cases, paying LMI may be worth it to enter the market sooner.

What are low deposit home loans?

Low deposit home loans allow buyers to enter the market with a 5–10% deposit. They may be ideal for those with limited savings but often come with LMI, and sometimes higher interest rates or stricter lending criteria. While helpful for getting into the market, it’s worth having an exit strategy, like refinancing once you build equity.

How can I save for a house deposit faster?

Consider opening a high-interest savings account (some even come with bonus interest and can be targeted towards junior savers) and cutting back on non-essential expenses. You can also explore government incentives and tools like round-up apps to boost savings automatically. Selling unused items online is another simple way to top up your deposit fund.

Can I use equity as a deposit for another property after buying my first home?

Yes – once you own a property, you can use your available equity as a deposit to buy another home or an investment property. Lenders will assess how much of your equity is usable, typically up to 80% of your property’s value minus your remaining loan.

Do lenders accept gifted deposits?

Yes, most lenders accept gifted deposits and inheritance from family, but usually require a signed declaration and proof the money isn't a loan.

Can I use a personal loan for a house deposit?

Most lenders don’t accept personal loans as a deposit because it increases your debt risk. Genuine savings or equity are preferred.

What does “Loan-to-Value ratio (LVR)” mean?

LVR is the percentage of a property’s value that you’re borrowing. For example, borrowing $720,000 on an $800,000 home gives you a 90% LVR. A lower LVR (80% or less) usually means better interest rates and avoids Lender’s Mortgage Insurance (LMI).

Is rent-to-own a good way to buy with a small deposit?

Rent-to-own can help buyers with small savings, but these arrangements often come with complex terms and higher long-term costs. Always read the fine print and talk to a professional to see if this is right for you.

What costs are not included in a house deposit?

Your deposit excludes upfront costs like stamp duty, conveyancing, building and pest inspections, house insurance and mortgage registration fees, which can add thousands to your purchase.

Should I buy now or wait to save more deposit?

It depends on your situation. Buying sooner with a smaller deposit can help you avoid rising house prices, but saving more can reduce your loan size and help you avoid LMI. Speak with a mortgage broker or financial adviser to find the best strategy for your goals and circumstances.

Important Disclosures

^Comparison rate warning

Home loan comparison rates are calculated based on a loan amount of $150,000 repaid over a 25-year term with monthly repayments. The comparison rates only apply to the examples given. Different loan amounts and terms will result in different comparison rates. Costs such as redraw fees or early repayment fees and cost savings such as fee waivers are not included in the comparison rate but may influence the cost of the loan. Check with the provider for full loan details, including rates, fees, eligibility and terms and conditions to make sure the product is right for you.

Products, features and information displayed

General information only The information on this page is general in nature and has been prepared without considering your objectives, financial situation or needs. You should consider whether the information provided and the nature of any home loan product is suitable for you and seek independent financial advice if necessary.

We are not providing you with a recommendation or suggestion about a particular home loan. You should read the relevant disclosure statements or other offer documents before deciding whether to apply for or continue to use a particular product.

What products, features and information are shown While we make every effort to ensure all home loans available in Australia are shown in our comparison tables, we do not guarantee that all products are included.

Our product comparisons may not compare all home loan features and attributes relevant to you.

Product information, such as interest rates, fees and charges, is subject to change without notice. Before acting on any information, you should confirm the relevant product information with the lender.

How home loans are sorted and filtered by default When results load initially in the main comparison table on this page, we show relevant loans from our sponsored partners first, then all loans on our database starting with the lowest relevant rate available from each of Australia's top 10 largest lenders first (top 10 is according to APRA, based on total value of loans per lender). We know these are the rates our customers are most interested in seeing. After these initial results, we show all products on our database, sorted as follows:

Lowest regular repayment amount, then;

Loans interest rate, then;

Lowest comparison rate, then;

Provider name (A-Z)

Home loans available though a broker

Some home loan products listed in our tables are available through a mortgage broker. Mortgage brokers may not be able to offer loans from every provider and there may be more suitable loans for your personal circumstances.

Mortgage brokers are not authorised by Money Pty Ltd's Australian Credit Licence and operate under their own Australian Credit Licence, or as a credit representative of another Australian Credit Licensee. Mortgage brokers can make recommendations about home loan products that may suit your objectives, financial situation and needs.

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