S
The sequence
The correct order of steps — most buyers get this wrong
The real issue
Most first home buyers start by searching for properties, then scramble for finance once they find something they want. This sequence causes them to miss properties, pay too much, or make offers they can't honour. The correct sequence puts finance first — so you know your real budget, your pre-approval gives you negotiating confidence, and you can move quickly when you find the right property.
- 1Check your eligibility for grants and concessions firstFHOG, stamp duty concessions, First Home Guarantee (5% deposit scheme) — these change your required savings figure. Do this before you set a target price.
- 2Calculate your full budget — deposit plus all upfront costsNot just the deposit. Add stamp duty, conveyancing, inspections, LMI (if applicable), lender fees, and moving costs. See the costs table in Section 2.
- 3Get pre-approval before you lookPre-approval tells you your real borrowing limit, not an estimate. It also signals to vendors that you're a serious buyer. Pre-approval typically lasts 90 days.
- 4Engage a conveyancer or solicitor before making an offerIn most states, you sign contracts before finance is unconditional. Your conveyancer reviews the contract before you sign — not after.
- 5Get a building and pest inspection before going unconditionalDo not waive this to win a deal. A $500 inspection that reveals $40,000 in damage is the cheapest decision you will ever make.
- 6Formal approval — then unconditionalPre-approval is not final approval. Formal (unconditional) approval from your lender comes after the bank has valued the property. Only go unconditional once you have this in writing.
- 7Settlement — organise insurance before settlement dayIn most states, risk passes to the buyer at signing, not settlement. Building insurance should be in place from the day you sign contracts.
C
True costs
The full upfront cost — what most buyers forget
| Cost | Typical range | Notes |
|---|---|---|
| Deposit | 5–20% of purchase price | Less than 20% triggers LMI unless using a guarantee scheme |
| Stamp duty | $0–$40,000+ depending on state and price | Largest variable cost. First home buyer concessions apply in most states — check before budgeting. |
| Lender's Mortgage Insurance (LMI) | $5,000–$25,000+ | Applies if deposit is less than 20%. Can be capitalised into the loan but adds to total cost. |
| Conveyancer / solicitor | $1,500–$3,000 | Do not use the cheapest — this person protects your largest financial transaction. |
| Building and pest inspection | $400–$700 | Non-negotiable. Get both in one inspection for combined pricing. |
| Lender fees (application, valuation, settlement) | $500–$1,500 | Varies by lender — ask for a full fee schedule before choosing. |
| Building insurance (from signing) | $1,200–$3,000 p.a. | Must be in place from date of contract signing in most states. |
| Moving costs | $500–$3,000 | Consistently underestimated. Get three quotes. |
| Utility connections and immediate repairs | $500–$2,000 | Budget a buffer — properties rarely need nothing on day one. |
ASIC MoneySmart — First Home Buyer Cost Calculator: moneysmart.gov.au/buying-a-home — includes stamp duty by state, LMI estimates, and a full upfront cost summary for your purchase price. Use this before you set your savings target.
G
Grants & concessions
What first home buyers can access — by state (as at March 2026)
These schemes change frequently. Thresholds, grant amounts, and eligibility rules are updated regularly by state and federal governments. Verify current eligibility directly with your state revenue office or on the NHFIC website before planning around any scheme.
| Scheme | What it provides | Where to check |
|---|---|---|
| First Home Owner Grant (FHOG) | One-off cash grant for new homes — amount varies by state ($10,000–$30,000). Does not apply to established homes in most states. | Your state revenue office. Search "[state] first home owner grant". |
| First Home Guarantee (federal) | Buy with 5% deposit, no LMI — government guarantees 15% of the loan. Limited places per financial year. Income and price caps apply. | nhfic.gov.au/support-to-buy-a-home/first-home-guarantee |
| Stamp duty concessions (varies by state) | Full or partial stamp duty exemption for first home buyers under a price threshold. Most valuable concession in high-value states (NSW, VIC). | Your state revenue office — concessions and thresholds vary significantly. |
| First Home Super Saver Scheme (FHSS) | Save up to $50,000 via voluntary super contributions, withdraw for a home deposit — taxed at 15% in super vs marginal rate outside. | ato.gov.au/individuals/super/withdrawing-and-using-your-super/first-home-super-saver-scheme |
| Regional First Home Buyer Guarantee | 5% deposit, no LMI, for buyers purchasing in regional areas. Separate places to the standard First Home Guarantee. | nhfic.gov.au |
T
Timing traps
Where deals fall over — and how to avoid them
| Trap | What happens | How to avoid |
|---|---|---|
| Pre-approval expires | Pre-approval lapses (typically 90 days) and you've made offers based on it. Formal approval may come back lower. | Renew pre-approval if your search extends beyond 60 days. Keep finances stable — no new debt, job changes, or large purchases during this period. |
| Bank valuation comes in below purchase price | Lender will only lend against the valuation — you must fund the gap from savings. | Research comparable sales before making offers. Avoid over-bidding at auction by more than 3–5% above your comparable sales analysis. |
| Going unconditional before formal approval | If formal approval is declined after you've gone unconditional, you lose your deposit and may be sued for the difference. | Never go unconditional without written formal approval from your lender. Pre-approval is not enough. |
| Skipping the building inspection to win at auction | Auctions are unconditional from the fall of the hammer. A defect discovered post-auction is entirely your cost. | Commission a building inspection before auction day. The cost is $400–$700 and you lose it if you don't buy — but you can't get it back if you buy a defective property. |
| Settlement funds not ready on settlement day | Missing settlement can trigger penalty interest (typically 10–12% p.a. on the outstanding balance per day) and ultimately allow the vendor to rescind. | Confirm settlement funds with your bank and conveyancer at least 5 business days before settlement. Book PEXA (electronic settlement) well in advance. |