How to save a house deposit and plan the upfront costs
The deposit is only part of what you need on settlement day.
Most lenders want a deposit of 5% to 20% of the price. A 20% deposit usually avoids lenders mortgage insurance, which is an extra cost added when you borrow more than 80% of the property's value. On top of the deposit you need money for stamp duty, legal and inspection fees and moving.
Build your target
Use a realistic figure for the property you want, not the cheapest one on the market.
For a $700,000 property, 20% is $140,000, 10% is $70,000 and 5% is $35,000.
Stamp duty varies by state and price, and first home buyers may get a concession or grant. Add legal fees, inspections and moving.
Even a small high-interest savings account adds a few thousand dollars over several years.
Worked example
A $700,000 property with a 20% deposit ($140,000) plus $35,000 of costs gives a target of $175,000. Starting with $30,000 and saving $2,000 a month at 4.5% interest, you'd get there in about 5 years and 2 months.
✨ Key Takeaways
- Your target is the deposit plus upfront costs.
- 20% usually avoids lenders mortgage insurance.
- Check your state revenue office for stamp duty and first home buyer help.
Open the house deposit calculator →