According to new research, it is taking young couples approximately five years on average to save for a 20% home loan deposit. 

It has never been tougher to save a deposit for your first home. In Sydney, the average timeframe is 8+ years, and in Melbourne, the average timeframe is 6.5 years. And in most other places across the country it is between 4 to 6 years.

That is unless you know a finance professional who can help first home buyers purchase a home with just a 5% deposit, and not pay any lender’s mortgage insurance in the process.

So, how do we do that? Well if you are eligible, we can hook you up with the First Home Guarantee (FHG) scheme, which will release 35,000 places from 1st of July. By getting in early on this scheme and reserving a spot, you can quarter the amount of time it takes to save up for your first home deposit.

Check Out These Stats

Here you will see how long it is currently taking first home buyers to save for a 20% home loan deposit (according to Domain data), compared to saving just 5%

Sydney: 8 years 1 month (20%), down to 2 years (5%).
Melbourne: 6 years 6 months (20%), down to 1 year 7 months (5%).
Brisbane: 4 years 10 months (20%), down to 1 year 3 months (5%).
Adelaide: 4 years 7 months (20%), down to 1 year 2 months (5%).
Perth: 3 years 7 months (20%), down to 11 months (5%).
Hobart: 5 years 10 months (20%), down to 1 year 5 months (5%).
Darwin: 4 years 3 months (20%), down to 1 year (5%).
Canberra: 7 years 1 month (20%), down to 1 year 9 months (5%).
Combined capital cities: 5 years 8 months (20%), down to 1 year 5 months (5%).
Combined regionals: 3 years 10 months (20%), down to 11 months (5%).
Australia-wide: 4 years 5 months (20%), down to 1 year 1 month (5%).

So, if you have been saving towards a 20% deposit for at least a year, you could be ready to hit the ground running when the 35,000 FHG schemes become available on the 1st of July.

The First Home Guarantee Scheme

The First Home Guarantee scheme (previously the First Home Loan Deposit Scheme) allows eligible first home buyers to build or purchase a home with only 5% deposit without paying lenders’ mortgage insurance (LMI). This is because the federal government guarantees (to a participating lender) up to 15% of the value of the property purchased.

By not paying LMI, a buyer can save anywhere between $4,000 and $35,000 depending on the property prices and deposit amount (it’s also worth noting that property price caps apply).

But places in this scheme are on a first-come, first-served basis. Don’t let the recent expansion of 35,000 spots lull you into a sense of complacency as they will go fairly quickly, which means that if you are interested, you will want to get in touch with us asap to ensure you are ready to lodge the application when the 1st of July comes along.