Is a 20% house deposit always required?

No. Many lenders accept smaller deposits, though under 20% usually means paying LMI. Government low-deposit schemes can let eligible buyers avoid LMI with as little as 5%.

Can I use a gift from my parents as part of my deposit?

Often yes. Many lenders accept gifted funds, sometimes with a letter confirming the money is a gift and not a loan. Rules vary between lenders, so it is worth checking your situation.

How much should I save on top of my deposit in Newcastle?

It is wise to budget for costs like stamp duty, conveyancing, inspections, and loan fees, plus a small buffer for surprises. The exact amount depends on the property and your eligibility for any concessions.

How Much Deposit Do You Really Need to Buy a House?

Saving for a house deposit can feel like a mountain. The good news is the number you need might be smaller than you think.

The classic 20% deposit

For years, the standard goal has been a 20% deposit. Put down 20% and you usually avoid Lenders Mortgage Insurance, often called LMI. That is a one-off cost lenders add when your deposit is small, to protect themselves if the loan is not repaid.

On a $600,000 home, a 20% deposit is $120,000. That is a big chunk of money, and it can take years to save.

A 20% deposit is still a solid target if you can reach it. It means a smaller loan and no LMI. But it is not the only path into a home. If you are weighing up your options, our home loans page is a good place to start.

What a low-deposit scheme changes

Some buyers use a government low-deposit scheme. Under these schemes, the government guarantees part of your loan. That means you can buy with as little as a 5% deposit and still avoid LMI, because the guarantee does the job the insurance normally would.

A 5% deposit on a $600,000 home is just $30,000. That is a very different goal to $120,000.

These schemes have rules. There are price caps, income limits, and a set number of places each year. They are often popular with first home buyers, but eligibility is not guaranteed for everyone.

Costs beyond the deposit

Your deposit is not the only money you need. There are other upfront costs to plan for.

These can include stamp duty, though first home buyers in NSW may get a concession. You may also need to budget for conveyancing, building and pest inspections, loan fees, and moving costs.

It pays to have a small buffer left over after settlement too. A surprise repair in your first month is much easier to handle with a little cash set aside.

Bigger deposit or buy sooner?

There is a real trade-off here. A bigger deposit means a smaller loan and less interest over time. Buying sooner with a smaller deposit means you stop renting and get into the market earlier.

There is no single right answer. It depends on your income, your savings rate, house prices in your area, and how steady your work feels.

This thinking matters whether you are buying your first place, looking at investment loans, or planning to refinance down the track. A broker can run the numbers for your situation and show you what each path looks like.

If you would like a clear, no-pressure chat about your deposit and options, you can request a callback and we will talk it through.

This article is general information only and does not take your personal circumstances into account. Speak to a licensed mortgage broker for advice specific to you.