Professionals Real Estate 
Early Start for Australia’s 5% Deposit Scheme
Saving for a deposit has long been a barrier for many first-time buyers, with the traditional 20% deposit requiring years of savings. Australia’s new 5% deposit scheme aims to fix this, and it will be live from October 2025.
What is the 5% deposit scheme?
Under the scheme, first-time buyers can purchase a home with as little as 5% deposit without having to pay lenders’ mortgage insurance (LMI). In effect, the government guarantees part of the loan, allowing buyers to enter the market sooner.
The initiative aims to ease the path to home ownership, particularly since property prices remain high across the country.
In the past, the number of participants was capped at a specific income and participant numbers were limited, but from October 2025 it will be available to all first home buyers, with no restrictions on income. The maximum amount a purchase can cost has risen too, for example from $900,000 in Sydney to $1.5 million.
Supporters of the scheme say it will help young people and first home buyers achieve the dream of home ownership sooner.
Five tips to secure your first home loan
If you’re considering using the 5% deposit scheme, here are five steps to take:
- Check your eligibility: Review the government’s criteria around income limits, property value caps and first-home buyer status.
- Get your finances in order: Lenders will still assess your income, spending and credit history.
- Work out your budget: Consider additional costs such as legal fees and moving expenses.
- Seek pre-approval: This shows sellers and real estate agents you’re serious and gives you a clear idea of your borrowing capacity.
- Find the right property: Research suburbs, property types and market trends to make a confident decision.
Avoid the Rush
The program’s earlier-than-anticipated launch is expected to increase competitiveness among first-time homebuyers. Demand may temporarily increase as a result, especially for affordable real estate. You’ll have a greater chance of finding a house before rising competition pushes prices higher if you move quickly.
Get Professional Help to Buy Your First Home
Navigating the property market can feel overwhelming, especially if you’re buying for the first time. Speaking with a trusted real estate professional can help you understand your options, access the best opportunities and feel confident about your next step.
Ready to get started?
Whether you’re ready to buy or want advice on where to begin, reach out to your local Professionals agent today. With expert guidance, that first set of keys could be closer than you think.
