Saving for your first home can feel overwhelming, but breaking it into clear steps makes the goal far more achievable. Whether you're just starting out or already have some savings set aside, this guide walks you through everything you need to do - from calculating your target to accessing government schemes that can accelerate your timeline.

Step 1: Understand How Much You Need

The first step is getting clear on the numbers. The minimum deposit for most home loans is 5% of the purchase price, but 20% is the ideal target to avoid Lenders Mortgage Insurance (LMI).

  • 5% deposit on a $500,000 home: $25,000
  • 20% deposit on a $500,000 home: $100,000
  • Plus stamp duty and purchase costs: Allow an additional 3-5% on top of your deposit
  • LMI consideration: If you purchase with less than 20% deposit, you'll typically be required to pay LMI - this can add thousands to the cost of your loan

Research property prices in your target area to anchor your deposit goal to a realistic purchase price. Keep in mind that prices shift over time, so factor in some buffer.

Step 2: Set a Savings Goal

Once you know your target amount, reverse engineer a monthly savings figure based on your timeline. For example:

  • Goal: $50,000 deposit
  • Timeframe: 5 years (60 months)
  • Required monthly savings: approximately $833/month

If that figure feels too high, consider adjusting your timeframe, targeting a lower purchase price, or looking at government schemes that can reduce your required deposit (see Step 5).

Step 3: Create a Budget

A budget is the engine of your savings plan. You can't consistently hit a monthly savings target without knowing where your money is going. The Australian Government's free MoneySmart Budget Planner is an excellent starting point.

  • Prioritise essentials first: Rent/mortgage, groceries, utilities, transport, insurance
  • Set savings aside at the start: Treat your monthly savings contribution like a non-negotiable bill - automate it on payday
  • Reduce non-essential spending: Subscriptions, dining out, impulse purchases - even small cuts add up significantly over a year
  • Build an emergency fund: Aim for 1-3 months of living expenses set aside separately so that unexpected costs don't derail your deposit savings

Step 4: Open a High-Interest Savings Account

Where you keep your savings matters. A high-interest savings account can meaningfully increase the amount you accumulate over time through compound interest.

  • Look for accounts offering bonus interest rates for regular monthly deposits
  • Ensure the account has no monthly fees that erode your savings
  • Compare rates regularly - bonus rates can change, and loyalty doesn't always pay with banks
  • Keep your savings account separate from your everyday transaction account to reduce the temptation to dip into it

Step 5: Explore Government Assistance

There are several government programs designed specifically to help first home buyers get into the market sooner:

  • First Home Owner Grant (FHOG): A one-off cash grant for eligible first home buyers purchasing or building a new home. Queensland currently offers $30,000 for contracts signed up to 30 June 2026, on new homes valued less than $750,000 - see the Queensland Revenue Office for full eligibility.
  • First Home Buyer Guarantee (FHBG): Allows eligible buyers to purchase with as little as a 5% deposit without paying LMI. The Federal Government guarantees the remaining deposit shortfall.
  • First Home Super Saver Scheme (FHSSS): Eligible Australians can make voluntary contributions to their superannuation and later withdraw up to $50,000 for a first home purchase, with potential tax advantages.
  • Stamp duty concessions: Many states offer full or partial stamp duty exemptions for first home buyers below certain purchase price thresholds. In Queensland, concessions apply to both new and established homes for eligible buyers.

Eligibility criteria apply to all of these programs. Speak with a broker or financial adviser to understand which schemes you qualify for.

Step 6: Stay Motivated

Saving a deposit over several years requires sustained discipline. Here are a few strategies to help you stay on track:

  • Celebrate milestones: When you hit 25%, 50%, and 75% of your goal, acknowledge the achievement. Small rewards help maintain momentum.
  • Track progress visually: A simple chart on your phone or fridge showing your savings balance growing toward your target can be surprisingly motivating.
  • Review regularly: Check in on your budget and savings every quarter. Life changes - your income, expenses, or property goals may shift, and your plan should adapt accordingly.
  • Visual reminders: Keep a picture of the type of home or suburb you're saving toward somewhere visible. It's a simple but effective way to stay connected to your goal on difficult days.

When you're getting close to your deposit target, speaking with a finance broker is the natural next step. We can assess your borrowing capacity, explain your loan options, and guide you through the pre-approval process - all at no cost to you. Get in touch with our team whenever you're ready.