Should You Jump In with 5% Deposit or Keep Saving for 20%?

A big question for many first-home buyers is whether to buy now with a 5% deposit or keep saving until you’ve got 20%. Both have their pros and cons, and it really comes down to your personal situation.

5% Deposit Now

• Get into the market sooner (especially before prices or competition rise).

• Keep more of your savings for moving costs or unexpected expenses.

• But you’ll be borrowing more, so your repayments will likely be higher.

20% Deposit Later

• Smaller loan means lower repayments and less interest over time.

• No LMI at all, regardless of the scheme.

• But it can take years longer to save - and in that time, prices may rise.

There’s no one-size-fits-all answer. It depends on your cash flow, your risk tolerance, and how quickly you want to get into the market.

Your conveyancer can guide you through the legal side of buying and help with what to look out for in a property. But when it comes to finance, it’s always best to chat with your broker - they’ll give advice tailored to your personal situation.

Also keep in mind: deposit requirements, government schemes and incentives can vary from state to state. Make sure you check what applies where you’re buying, and get advice tailored to your own situation.