Market Updates
How much deposit do you need to buy a house in Victoria?
How much deposit do you actually need?
The 20% figure is a threshold, not a requirement. It is the point at which lenders stop charging lenders mortgage insurance. Below it you can still borrow, and plenty of people do.
LMI is the part most buyers have backwards. It does not protect you. As ASIC's Moneysmart puts it, "LMI does not benefit the borrower, it only protects the lender." It is usually a one-off cost to you, payable when you borrow more than 80% of the property's value.
| Deposit | LMI | What it unlocks | What to watch |
|---|---|---|---|
| 5% | Payable, unless you qualify for a government guarantee | Buying years earlier than a 20% target allows | Price caps apply under the guarantee scheme, and a smaller deposit means a larger loan and higher repayments |
| 10% | Usually payable | A wider choice of lenders than at 5% | LMI is a one-off cost that is often added to the loan, so you pay interest on it |
| 20% | Not payable | The broadest lender choice and no LMI cost | Saving to 20% takes most buyers years, and prices may move while you save |
What grants and schemes can Victorian first home buyers use?
Three programs matter in Victoria. Each has its own thresholds and its own conditions, and each is administered separately.
| Scheme | What you get | Property price cap | Key conditions | Source |
|---|---|---|---|---|
| Australian Government 5% Deposit Scheme | Buy with a 5% deposit and no lenders mortgage insurance. The government guarantees part of the loan. | $950,000 in Melbourne and Geelong. $650,000 across the rest of Victoria. | No income caps and no limit on places. You must be an eligible first home buyer and live in the home. | firsthomebuyers.gov.au |
| First Home Owner Grant (Victoria) | A $10,000 payment. | Home valued up to $750,000. | New or never-occupied homes only. Established homes do not qualify. | SRO Victoria |
| First home buyer duty exemption or concession | No stamp duty up to $600,000. A reduced amount from $600,001 to $750,000. | Dutiable value up to $750,000. | Must be your principal place of residence, lived in for 12 continuous months starting within 12 months of settlement. No purchaser may have owned residential property in Australia before. | SRO Victoria |
These are separate programs with separate eligibility rules. Check each one against your own situation rather than assuming that qualifying for one means qualifying for another.
"Most people who come to me believing they are three years away are closer than they think, and a few who believe they are ready are not. The deposit is only the number you can see. What decides it is the whole picture underneath."
Deposit isn't the only test
Having the deposit does not mean the loan is approved. Lenders also look at how you saved it, since some want genuine savings built up over months rather than a sudden lump sum. They look at income stability, which is why a recent job change can matter more than the amount in your account. They look at existing debts, including HECS, car finance and the limits on cards you never use. Sort these out before you go shopping, not after.
Work out your own numbers
The First Home Buyer Planner puts your borrowing power, the schemes you may qualify for and your likely costs in one place. The Smart Mortgage Calculator adds repayments and stamp duty. Both give estimates, not a loan approval. If a term here is new, the jargon buster defines it.
Common questions
Can I buy with a 5% deposit in Victoria?
You may be able to. The Australian Government 5% Deposit Scheme lets eligible first home buyers purchase with a 5% deposit and no lenders mortgage insurance, with no income caps and no limit on places. Property price caps apply: $950,000 in Melbourne and Geelong, and $650,000 across the rest of Victoria. You still need to meet the lender's own credit criteria.
Does the First Home Owner Grant count towards my deposit?
The $10,000 grant is generally paid at or after settlement rather than being available as savings up front, so most lenders will not treat it as part of the deposit you need to show. Talk to your lender or broker about the timing before you rely on it.
What is a genuine savings requirement?
Some lenders want to see that part of your deposit was saved by you over time, usually a few months of consistent deposits into an account in your name, rather than arriving as a lump sum. Policies differ between lenders, and gifts and inheritances are treated differently again.
Do I pay stamp duty as a first home buyer in Victoria?
Not on a home with a dutiable value up to $600,000, where you pay no duty at all. Between $600,001 and $750,000 you pay a reduced amount. Above $750,000 the first home buyer exemption and concession do not apply. Conditions include living in the home as your principal place of residence for 12 continuous months.
Get the full guide
Everything above is the map. The guide is the walkthrough. It adds the deposit and savings worksheets, how individual lenders differ on the things that decide your application, a savings plan built around your target, and a step by step walk through the application.
Sources
- $10,000 First Home Owner Grant, new or never-occupied homes valued up to $750,000. SRO Victoria
- No stamp duty up to $600,000, reduced duty from $600,001 to $750,000, and the residence conditions. SRO Victoria
- 5% deposit, no LMI, no income caps and no limit on places. firsthomebuyers.gov.au. Victorian property price caps of $950,000 and $650,000. Property price caps
- What lenders mortgage insurance covers. ASIC Moneysmart
Figures verified 11 August 2026. Scheme thresholds change at state and federal budgets, so check the linked sources before you rely on a number. This page is general information only and does not take account of your personal circumstances. Eligibility for any scheme depends on your situation and is decided by the relevant authority or lender. Equifin Pty Ltd is Credit Representative 522395 of BLSSA Pty Ltd ACN 117 651 760, Australian Credit Licence 391237. Terms, conditions, fees and charges may apply. Normal lending criteria apply.