Buying Your First Home
Buying your first home is exciting, but the process and the paperwork can feel overwhelming. So we’ve put together this guide to walk you through the essentials, broken into sections so it’s easy to follow.
Buying your first home, made simpler.
FIRST STEP: Watch this video of Tamara Virgo to learn more about Deposits.
First Home Buyer Guide
When you apply for a home loan, lenders assess you against three key factors:
Capacity to repay. Based on your income and expenses, how much a lender may be willing to lend you.
Deposit and equity. Your loan-to-value ratio (LVR), and whether you have ‘genuine savings’.
Character. How a lender views you as a borrower: account conduct, credit history, savings and employment history, and more.
How do banks decide how much you can borrow?
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Deposit - how much do I actually need?
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Saving a deposit is often the biggest hurdle for first home buyers, which is why both the state and federal governments offer grants and schemes to help. Most lenders like to see around 20% of the property value, but eligible buyers may get in with less.
Here’s what to understand first.
Genuine savings
Lenders use ‘genuine savings’ as a measure of financial discipline. It’s usually required when your deposit is under 20% of the property value, though some lenders may waive it depending on your situation.
Usually counts as genuine savings:
Regular deposits into a savings account over 3+ months
Term deposits held for 3+ months
Shares or managed funds held for 3+ months
Equity in an existing property
Can be used, but treated differently (not counted as genuine savings):
Gifts from family
Tax refunds
Bonuses or lump sum payments
Inheritance (unless held in savings for 3+ months)
What grants and schemes can I access in WA?
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First Home Owner Grant (FHOG) – new builds only
A one-off payment of $10,000 for first home buyers building or buying a newly constructed home to live in as their main residence. Property value cap: $800,000 south of the 26th parallel (Perth metro and most of the state), or $1,000,000 north of the 26th parallel. Reference: wa.gov.au
Stamp duty (transfer duty) concessions
Full exemption: no duty payable on homes valued up to $600,000, or vacant land up to $450,000.
Concessional rate: applies to homes valued $600,000–$800,000, and vacant land valued $450,000–$550,000.
Home Buyers Assistance Account (HBAA)
A grant of up to $2,000 towards incidental costs (like settlement agent fees and inspections) when buying an established home through a licensed real estate agent, generally for properties up to $500,000. Caps can vary, so we’ll confirm based on your purchase. Reference: wa.homebuyers.com.au
Australian Government 5% Deposit Scheme (formerly the First Home Guarantee)
This scheme lets eligible first home buyers purchase with a deposit as low as 5%, without paying Lenders Mortgage Insurance (LMI). As at October 2025, there are no income caps and no limit on places, so it’s open to everyone who’s eligible. Property price cap: $850,000 for Perth and regional centres, or $600,000 for other WA areas. Reference: housingaustralia.gov.au
What does this mean in real numbers?
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Here’s an example for a $600,000 purchase using the 5% Deposit Scheme. Figures are indicative only and subject to change and confirmation.
Settlement costs (approx.)
$ 4,500.00 (estimate only)
Total costs
$ 604,500
Loan amount (95% LVR)
$ 570,000
Deposit required
$ 34,500
AMOUNT
ITEM
$ 600,000
Purchase price
$ 0 (first home buyer concession; see note below)
Stamp duty
$0 (not applicable under the government guarantee)
Lenders Mortgage Insurance
Why this often works out cheaper: the 5% Deposit Scheme can avoid LMI altogether. LMI protects the lender if a loan can’t be repaid and the sale doesn’t cover the shortfall, and it’s normally required once you’re borrowing more than 80% of the property’s value. Under the scheme, the government guarantees that shortfall instead, so LMI isn’t charged.
One important note: A place on the 5% Deposit Scheme can’t be applied for until you have loan approval with a lender, so it’s worth having a backup plan for your deposit in case there’s a delay.
Just because you can borrow it doesn’t mean you should…
WATCH: First Home Buyer Mistakes to Avoid
Frequently Asked Questions
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Most lenders look for around 20% of the property price, but eligible first home buyers may get in with as little as 5% through the Australian Government 5% Deposit Scheme, without paying LMI. Some lenders may also accept a 10% deposit. The right path depends on your situation, which is what we help you work out.
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Generally, money you’ve saved yourself over at least three months: regular savings deposits, term deposits, shares or managed funds held for 3+ months, or equity in a property. Gifts, tax refunds, bonuses and recent inheritances can often still be used, but they’re usually treated differently.
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Eligible first home buyers may pay no transfer duty on homes valued up to $600,000, with a concessional rate between $600,000 and $800,000. Thresholds can change, so it’s worth confirming the current figures for your purchase.
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The $10,000 FHOG is generally for building or buying a newly built home, not an established one. If you’re buying established, other help like stamp duty concessions or the Home Buyers Assistance Account may apply instead.
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LMI protects the lender, not you, and is usually charged when you borrow more than 80% of a property’s value. Eligible buyers using the 5% Deposit Scheme can avoid it, because the government guarantees the shortfall instead.
Want to see the full picture for your situation?
