How much deposit do you really need?

The "you need a 20% deposit" line gets repeated so often that plenty of would-be buyers put off even looking. The truth is more flexible than that - 20% is a useful benchmark, not a hard rule, and there are several legitimate ways to buy with less.

Why 20% is the benchmark

Save a 20% deposit and you typically avoid Lenders Mortgage Insurance (LMI) - a one-off cost that protects the lender, not you, when you borrow with a smaller deposit. A larger deposit can also give you access to a wider range of loans. So 20% is worth aiming for, but it isn't the only door in.

Buying with less than 20%

Many lenders will consider as little as a 5–10% deposit. The trade-off is usually LMI, which can often be added to the loan rather than paid up front. For some buyers, paying LMI and getting into the market sooner works out better than waiting years to save the full amount - and for others it doesn't. It's a numbers question worth running properly.

Government schemes can lower the bar

Eligible buyers may be able to use schemes like the Home Guarantee Scheme to buy with a smaller deposit without paying LMI, and there are grants that can help with newly built homes in Queensland. Eligibility, caps and availability change over time, so the right move is to confirm what you currently qualify for rather than rely on last year's rules.

The guarantor option

If a family member is willing to offer equity in their own property as additional security, a guarantor arrangement can reduce or remove the deposit hurdle. It's a big ask with real responsibilities on both sides, so it's worth understanding clearly before going down that path.

What actually matters

Beyond the headline percentage, lenders look at genuine savings, your borrowing capacity, and whether you've budgeted for the other costs of buying - transfer (stamp) duty, legal fees and the like. Getting a clear picture of all of it up front is what stops surprises later.

The bottom line

There's rarely a single "right" deposit - it depends on your situation, the costs involved and how the schemes apply to you. A quick conversation will tell you what's realistic and what your options actually are.