For many first-home buyers in Australia, the idea of building a home can feel overwhelming. One of the biggest questions we hear is: “How much do I actually need to save before I can start building?”
It’s a common misconception that you need a huge deposit to get started. The reality is, with the right guidance and planning, you can begin turning your dream home into a reality with a realistic savings goal, and often sooner than you think.
Typical Deposit Expectations
When it comes to building a house in Australia, the deposit you need upfront varies depending on your lender, the type of loan, and the property itself. Generally, most lenders look for a deposit of 5-20% of the total land and construction costs.
For example, for a $600,000 build, this could mean a deposit of roughly $30,000–$120,000. Knowing this range helps you plan more realistically.
It’s also important to understand that building a home usually involves multiple payments, not just a single deposit. For instance:
- Land deposit: If you’re buying a block of land, you may need 5-10% upfront, depending on the contract.
- Construction progress payments: Builders usually require staged payments as construction milestones are reached, such as laying the foundation, framing, roofing, and completion.
Being aware of these stages can help you budget effectively and avoid financial surprises.
Government Grants and Schemes
Australian first-home buyers may be eligible for a range of incentives that reduce how much you need to save upfront. These include:
- First Home Owner Grant (FHOG) – A one-off payment for eligible buyers building a new home. The amount varies by state. For example, in Queensland, the grant is $30,000 for contracts signed or construction started between 20 November 2023 and 30 June 2026. After this period, the grant reverts to $15,000. In New South Wales, the current grant is $10,000. Grant amounts vary in other states.
- First Home Guarantee (formerly the New Home Guarantee) – Allows eligible first-home buyers to build or purchase a new home with as little as a 5% deposit without paying lenders mortgage insurance (LMI).
- State-specific grants and concessions for new builds, such as stamp duty exemptions or reductions, which can further ease upfront costs.
These incentives make building a home more achievable, even if you haven’t been able to save a large deposit yet.
Hidden and Additional Costs to Plan For
Even with a deposit and government grants, there are often extra costs first-home buyers overlook. These can include:
- Site costs, such as clearing, soil testing, or levelling
- Lender fees, legal fees, and conveyancing costs
- Council approvals, utility connections, and permits
- Unexpected costs during construction
It’s wise to plan a buffer on top of your deposit and construction costs. Factoring these in ensures your project runs smoothly without financial stress.
How a Home Loan Broker Can Help
Navigating construction loans and finance can feel complicated, especially for first-home buyers. That’s where a home loan broker can make a real difference.
A broker can:
- Assess your finances and help set a realistic first-home buyer savings goal
- Connect you with lenders offering low-deposit options for building a house in Australia
- Guide you through government grants, schemes, and approvals
- Advise on managing construction progress payments and extra costs
With professional support, you don’t need to have all your savings upfront, or all the answers. A broker helps you plan your finances confidently, making your dream home more achievable.
Take the Next Step
Building your first home doesn’t have to feel out of reach. With a clear plan, expert guidance from a broker, and a realistic savings goal, you can start turning your dream into reality.
At Loan Gallery Finance, we offer free discovery sessions to help first-home buyers understand exactly how much deposit and savings they need to start building. Arrange a call today, and let us guide you step by step, from planning to moving into your new home.
