For many Australians, buying their first home remains one of the most important financial goals they'll work towards - but the gap between aspiration and reality has never felt wider. Rising property prices, elevated rents eating into savings capacity, and the psychological weight of the task can make it hard to know where to start. The latest data paints a sobering picture, but also highlights real opportunities for those who know which levers to pull.

The Reality of Saving

On average, it now takes an Australian on a typical income approximately 5.9 years to save a 20% deposit. That's nearly six years of consistent, disciplined saving - and that figure assumes no major financial setbacks along the way. In Sydney and Melbourne, the timeline stretches close to a full decade for many buyers, which goes a long way towards explaining why so many first home buyers are turning to government assistance schemes and lower-deposit options.

To put the numbers in perspective: the average first home buyer deposit in Australia was $135,000 in 2025. Entry-level house prices rose 15% across the country over the year, with the national median for entry-level homes now sitting well above what most buyers anticipated saving for even two or three years ago. (Source: Finder)

City by City Comparison

The challenge varies significantly depending on where you want to buy. Sydney stands in a category of its own - it is the only city in Australia where the entry-level house price has now crossed the $1.15 million mark. Saving a 20% deposit on that figure means accumulating over $230,000 before even accounting for stamp duty and purchase costs. For buyers in Sydney, the path to a 20% deposit is genuinely daunting, and many are choosing to enter with a smaller deposit supported by government schemes instead.

Other capital cities present a more achievable - though still challenging - picture. Brisbane, Adelaide and Perth offer entry-level price points well below Sydney and Melbourne, and in some cases the combination of a lower target deposit and stronger savings capacity (due to lower rents) means the timeline is meaningfully shorter.

Government Schemes That Help

The good news is that you don't necessarily need a full 20% deposit to buy your first home. Several government programmes exist specifically to help first home buyers get into the market sooner:

First Home Guarantee (FHBG)

From October 2025, the Federal Government's First Home Guarantee was expanded significantly. The scheme now operates with no cap on the number of places available and no income caps for applicants, making it accessible to a much broader range of buyers. Under the scheme, eligible first home buyers can purchase with a deposit as low as 5% without paying Lenders Mortgage Insurance (LMI) - a cost that can otherwise run into tens of thousands of dollars.

First Home Owner Grant (FHOG)

State-based First Home Owner Grants provide a lump sum payment to eligible buyers purchasing or building a new home. In Queensland, eligible buyers can receive a $30,000 grant for contracts signed between 20 November 2023 and 30 June 2026, on new homes valued less than $750,000 (see Queensland Revenue Office). Grant amounts, property price caps and eligibility rules vary by state and change periodically, so check your state's revenue office for current details.

First Home Super Saver (FHSS)

The First Home Super Saver scheme allows individuals to make voluntary contributions into their superannuation and later withdraw those funds for a home deposit. The maximum amount that can be released under the scheme is now $50,000 per person - meaning a couple can together access up to $100,000 from super, tax-effectively, towards their deposit. This can dramatically reduce the time needed to save, particularly for buyers who start making voluntary contributions early.

Practical Tips to Save Faster

Beyond government schemes, there are practical steps that can genuinely shorten your savings timeline:

  • Open a dedicated high-interest savings account: Keeping your deposit funds separate from everyday spending removes temptation and ensures your savings are always working as hard as possible.
  • Automate your savings: Set up a regular automatic transfer on payday so your savings happen before you have a chance to spend. Even modest amounts compound significantly over several years.
  • Review your biggest expenses: Rent, car costs and subscriptions are often the largest levers available. Even a small reduction in monthly rent - perhaps through a share house arrangement - can add thousands to your deposit fund each year.
  • Consider a lower deposit with LMI: For some buyers, paying LMI to enter the market sooner - before prices rise further - may make more financial sense than waiting years to reach 20%. A broker can model this for your specific situation.
  • Use the FHSS scheme from day one: The earlier you start making voluntary super contributions earmarked for your deposit, the more you'll accumulate and the greater the tax benefit.

How a Broker Can Help

Navigating the combination of savings strategies, government schemes, lender policies and deposit requirements can feel overwhelming. A mortgage broker can help you understand exactly how much you need to save, which schemes you're eligible for, and which lenders will work with a lower deposit in your situation. They can also map out a clear timeline so you know what milestones to hit and when.

If you're working towards your first home and want a clear picture of where you stand, reach out to the Loan Hive team. We work with first home buyers every day and we're here to help you cut through the noise and get into your first home sooner.