A 20% deposit on a $750,000 home is $150,000. Six ways to need less or save it sooner, with the figures for each. Updated October 2026.
How much deposit do you need?
Most Australians assume they need 20% to buy a home. The reality is more nuanced:
- 5%: minimum with the federal 5% Deposit Scheme (no LMI, government-backed)
- 5–10%, possible with LMI (on a $700,000 home, about $13,700 at a 10% deposit and $24,600 at 5%)
- 20%: avoids LMI and gives access to every lender and its lowest-LVR rate tiers
- 2%, minimum for single parents via the Family Home Guarantee
Before saving for 20%, check whether you qualify for the 5% Deposit Scheme. It cuts the deposit from 20% to 5% without LMI.
Strategy 1: Open a dedicated high-interest savings account
A transaction account pays little or no interest. A high-interest savings account pays a bonus rate when you meet its conditions: at 5% a year, a $100,000 balance earns $5,000. Compare current bonus rates and conditions before you choose; they change with the cash rate.
Strategy 2: Use the First Home Super Saver Scheme (FHSS)
The FHSS allows you to make voluntary contributions to your superannuation and withdraw them (plus earnings) to use as a house deposit. The tax advantage is substantial:
- Voluntary contributions are taxed at just 15% (versus your marginal rate, which could be 30–47%)
- You can contribute up to $15,000 per financial year and withdraw up to $50,000 total
- Withdrawals are taxed at your marginal rate less a 30% tax offset, still far less than income tax
For a person earning $90,000, the FHSS can save approximately $3,000–$5,000 in tax per $15,000 contributed, effectively giving you a 20–33% return on your deposit savings before interest.
Strategy 3: The 50/30/20 deposit plan (modified)
A traditional budget splits income into 50% needs, 30% wants, and 20% savings. For serious deposit savers, modify this to 50/10/40, cutting discretionary spending in half and doubling savings. On a $80,000 after-tax income ($6,667/month), this generates $2,667/month in savings, $32,000 per year.
Strategy 4: The parental guarantor option
If your parents own property with sufficient equity, they can act as guarantor for part of your loan, allowing you to purchase with a much smaller deposit (sometimes 5% or less) without paying LMI. The guarantee is limited to the portion needed to reach 20% LVR and is released once your loan-to-value ratio improves through repayments or property growth.
This approach requires careful consideration, the guarantor's property is at risk if you can't repay. A mortgage broker and solicitor should be involved before proceeding.
Strategy 5: Reduce credit card limits
Our borrowing capacity calculator counts 3.8% of a card limit as a monthly repayment, whatever the balance, as many lenders do. For a $100,000 earner at 6.2%, an unused $10,000 limit cuts borrowing by about $46,000. Cancelling unused credit cards before applying for a home loan directly increases the amount you can borrow.
Strategy 6: Consider regional markets
A 20% deposit on a $400,000 regional property ($80,000) is achievable far sooner than a 20% deposit on a $900,000 Sydney property ($180,000). Regional markets in Queensland, South Australia, and Western Australia have seen strong price growth in recent years while remaining meaningfully more affordable than major capital cities.
Track your progress
Use our affordability calculator to track which suburbs move into your "can afford" range as your deposit grows. Set a goal, link it to a timeline, and review monthly.