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Planning to buy your first home: a measured starting guide

3 hours ago

BlogBy Insight Wealth PlanningPublished 30 October 202610 min read

Last updated 17 October 2026

Buying a first home is one of the bigger financial decisions most people make, and the amount of information available about how to do it has become its own problem. There are government scheme explainers, mortgage broker blogs, first home buyer forums, YouTube channels, and real estate agent content streams, and none of it was written for your situation specifically. The volume of information often makes the decisions harder, not easier.

What follows is a plain walk through the questions and decisions that genuinely matter when you are seriously planning for a first home. Not every scheme, not every lender comparison. The shape of what to work through, roughly in the order it tends to come up.

Work out your real target first

Before you spend time on grants, loan products or inspection checklists, the single most useful piece of information you can get is a realistic number for what you are actually trying to buy. That number has three parts.

The price range for the kind of place you would actually live in. In the Hunter, that generally sits between $500,000 and $700,000 for a modest unit or townhouse, and anywhere from $700,000 to $900,000 (and often higher) for a house, with significant variation by suburb, land size and condition. A four-bedroom, two-bathroom house in reasonable condition will often sit above $850,000. Spend an evening on realestate.com.au with your real criteria (location, bedrooms, parking, condition) rather than browsing dream homes.
A workable deposit target. Twenty per cent of your target price is the number that avoids Lenders Mortgage Insurance (LMI), which we will come back to. On an $800,000 home that is $160,000. On a $550,000 unit it is $110,000. Those numbers tend to be sobering the first time you see them written down.
A monthly repayment you can live with. The amount a bank will lend you is not the same as the amount you can comfortably repay. A rough gut check: if the monthly repayment is more than about a third of your take-home pay, the lifestyle math gets uncomfortable quickly.

Those three numbers set the frame for everything that follows. They are also the three numbers to run past a planner or mortgage broker before you fall in love with any individual property.

The government schemes worth knowing about

First home buyers in NSW have access to a handful of grants, concessions and schemes. Not all of them will apply to you, and the eligibility rules and amounts change often enough that it is worth checking the current detail at the sources below before you plan around any of them. The quick guide:

First Home Owner Grant (FHOG). A one-off payment for eligible buyers of new homes in NSW (not established homes), currently $10,000 with price caps that apply.
First Home Buyers Assistance Scheme (FHBAS). The one most first home buyers benefit most from. It can give you a full stamp duty exemption or concession on homes up to the current NSW thresholds. On an $800,000 home that is often a saving in the tens of thousands.
First Home Super Saver Scheme (FHSSS). Lets you make voluntary contributions into your super and later withdraw them (plus deemed earnings) to put toward a deposit. The tax treatment on contributions and withdrawals makes it a quietly powerful tool for people with the earning capacity to use it, and most eligible first home buyers don’t.
Australian Government 5% Deposit Scheme (formerly the Home Guarantee Scheme, or First Home Guarantee). Lets eligible first home buyers purchase with as little as a 5 per cent deposit without paying LMI, because the government guarantees part of the loan. Since 1 October 2025 there are no income caps or place limits, although property price caps apply by location.
Help to Buy. A shared-equity scheme where the government takes an equity stake in the home so you can buy with a smaller deposit and smaller loan. Narrow eligibility rules, but worth knowing about if you qualify.

No single scheme is the right answer by itself. The useful conversation is which combination suits your situation.

Building the deposit

For most people, the deposit is the bottleneck. A few things that actually help, in order of impact.

Automate it. Set a direct transfer to a separate high-interest savings account the day after each pay lands. The savings that work are the ones you do not think about.
Consider the First Home Super Saver Scheme early. The tax structure around voluntary super contributions can genuinely accelerate a deposit, and it is one of the most under-used tools in the first home buyer kit. The constraint is that the money is locked in super until you are ready to withdraw it, so it suits people who are at least a year or two away from buying.
Be realistic about where the money comes from. Lenders will look at the pattern of your savings as part of their assessment. A gift from parents is fine (and often needed) but has to be structured and disclosed properly.
Think creatively about what cuts expenses. One of the more unusual deposit-saving strategies we have seen work well is cutting housing costs through house-sitting (we wrote about it in House-Sitting: Your Key to Travel While Saving for a Home). It is not for everyone, but for the right person it can shave serious time off the deposit timeline.
Keep the deposit account visible. Watching the number grow is motivating. Blending it into day-to-day cash is the single most common reason people take longer than they planned.

The costs most first home buyers miss

The deposit is not the only thing you need upfront. Budgeting roughly 4 to 6 per cent of the purchase price for other costs is a reasonable rule of thumb. The main items:

Stamp duty, unless the FHBAS exempts you.
Lenders Mortgage Insurance, if your deposit is below 20 per cent and you are not using the 5% Deposit Scheme. On an $800,000 home with a 10 per cent deposit, LMI can run into the tens of thousands of dollars added to your loan.
Conveyancing or legal fees, typically $1,500 to $3,000.
Building and pest inspections, typically $600 to $900 for a standard house.
Loan application and setup fees. Varies by lender.
Moving costs, utility connections, and the first few weeks of furniture and fit-out.

The combination usually surprises people the first time they add it up. Knowing the number before you commit stops it becoming a nasty surprise during settlement.

Talking to a lender: what matters

The amount a bank will lend you depends less on your income than most people assume. Three things move the number more than anything else:

Your other debts, especially credit card limits (which banks assess at the full limit, not the balance), personal loans, and HECS or HELP debt.
Your fixed monthly expenses, especially subscriptions, insurance premiums and discretionary spending that shows up on your statements over the three to six months before you apply.
Interest rate buffers. Banks assess serviceability at a rate above the current one, so what you can borrow in a lower-rate environment is less than you might expect.

Pre-approval is sensible once you are within six months of buying. Earlier than that and the pre-approval often expires before it is useful.

Things worth deciding before you start looking at houses

Where you are happy to live for at least five years. Transaction costs on property are high. Buying somewhere you will want to leave in 18 months is expensive.
What kind of mortgage structure suits you. Fixed, variable, or split. Whether you want an offset account (usually yes for most first home buyers).
Who is on the loan. If you are buying with a partner, agreeing in advance on how the loan is structured and what happens in different scenarios saves awkward conversations later.
What your life looks like for the next three years. If a career change, overseas stint, or a baby is on the horizon, factor that into what you can realistically service.

The quiet mistakes we see

Buying at the top of your borrowing capacity, then having nothing left over if interest rates move or a car dies.
Underestimating the cost of running a house compared to renting, especially rates, insurance, maintenance and utility costs.
Skipping building and pest inspections to save a thousand dollars and inheriting a $30,000 problem.
Not applying for the stamp duty concession in time, or missing it because the price was pushed above the threshold by last-minute offers.
Treating the deposit account as a general savings account during the buying process. The purpose of that money is to buy the house. Protect it.

When to get a planner involved

You do not need a financial planner to buy a first home. Plenty of people manage it well on their own. The moments where it tends to be useful:

Early, if you are two or three years out and want to use the First Home Super Saver Scheme well.
When you are trying to work out whether to prioritise the home deposit, extra super, or paying down existing debt. (The related question of whether to put spare money onto a mortgage or into investments comes up a year or two after you have moved in; we have written about that one in Pay Down Your Mortgage or Invest?)
When the deposit involves family help and you want to understand the implications on both sides.
When buying the first home interacts with other goals (a career change, starting a business, having kids) and you want someone to help you sequence things sensibly.

We work with first home buyers at the Foundations stage, where the question is less “which lender?” and more “does buying now, or in eighteen months, fit the bigger plan?”

Book an initial chat with the Insight Wealth Planning team →

Frequently asked questions

How much deposit do I actually need to buy a first home?

Twenty per cent of the purchase price is the amount that avoids Lenders Mortgage Insurance. Many first home buyers purchase with less (often 5 to 10 per cent), using schemes like the Australian Government 5% Deposit Scheme to avoid LMI, or paying LMI as part of the loan. There is no single right answer, but 20 per cent remains the cleanest number if you can get there.

Can I use my super to help buy a first home?

Yes, through the First Home Super Saver Scheme. You can make voluntary contributions into your super (there are annual and total limits) and later withdraw those contributions plus deemed earnings to use toward a deposit. The tax treatment is designed to make it faster than saving in a regular account. It suits people who are a year or two away from buying and have the earning capacity to make the extra contributions.

Does the stamp duty exemption for first home buyers apply in NSW?

Yes. The First Home Buyers Assistance Scheme can give you a full stamp duty exemption or concession on eligible homes under current NSW thresholds. The specific thresholds change from time to time, so check the current rules at Service NSW or Revenue NSW before you plan around it.

Is it worth getting pre-approval for a loan?

Yes, once you are within about six months of actively buying. Pre-approval tells you what you can realistically borrow and makes you a stronger buyer in a competitive market. Earlier than six months out and the pre-approval often expires before you are ready to use it.

Should I buy on my own or wait and buy with a partner?

That is a personal decision, but a few financial realities to know. Buying with a partner usually unlocks a bigger budget and lets you share both the deposit and the ongoing costs. Buying on your own gives you full control and avoids the complications of restructuring if the relationship changes. Both work, provided the strategy fits your situation.

General advice warning: the information in this article is general in nature and does not take into account your personal objectives, financial situation or needs. First home buyer grants, schemes, eligibility criteria and thresholds vary and may change. Please check current rules at Service NSW, the ATO or Housing Australia and seek personal financial advice where required. Insight Wealth Planning Pty Ltd is a Corporate Authorised Representative of GPS Wealth Ltd, ABN 17 005 482 726, AFSL 254544.