The dream of home ownership has long felt out of reach for many Australians, especially as housing prices in cities like Sydney and Melbourne continue to climb. But in 2025, first-home buyers are making bold moves — entering the market with low deposits and support from government schemes. If you’re one of them, here’s what you need to know.
Low Deposits Are on the Rise
A growing number of first-home buyers are choosing to purchase with just 8–10% deposits, taking advantage of initiatives like the First Home Guarantee Scheme. Many first-home buyers with low deposits are using these options to avoid LMI and enter the market sooner. This federal program enables eligible buyers to put down as little as 5% without paying lenders mortgage insurance (LMI), potentially saving tens of thousands.
Is a Low Deposit Home Loan Right for First-Time Buyers?
Benefits:
- Faster entry into the market — no need to wait years to save a 20% deposit
- Government support helps you avoid LMI
- Start building equity sooner, especially in a rising market
Risks:
- Higher LVR (loan-to-value ratio) means you’ll pay more interest over time
- Monthly repayments will be larger due to the bigger loan size
- You may have fewer lender options or stricter lending criteria
Maximise Your Success with a Low Deposit First Home Loan
First-home buyers using low-deposit strategies need expert advice to ensure they choose the right loan structure and understand their long-term obligations. Working with a broker ensures access to lenders who support government schemes and can help you secure competitive rates.
Need help finding the right lender?
At Glass Financial, our brokers compare options across dozens of lenders to ensure you’re getting the most competitive deal for your low deposit first home loan. We’ll walk you through the paperwork, explain eligibility, and ensure the loan structure suits your budget and goals.
Final Thoughts
Buying your first home in 2025 is achievable — even without a 20% deposit. But it requires careful planning, the right loan structure, and a clear understanding of your finances.
If you’re considering a low deposit home loan, make sure you check your eligibility for schemes like the First Home Guarantee.
At Glass Financial, we help first-home buyers move with confidence. Let us match you with a loan that fits your goals and helps you unlock home ownership sooner.
