The first home deposit NSW buyers need depends on the loan, the lender and the schemes you qualify for. You can now buy with as little as 5% if you meet the Government’s 5% Deposit Scheme rules, while a 20% deposit remains the traditional target because it avoids lenders mortgage insurance. This guide explains the real numbers, the grants and stamp duty concessions in New South Wales, and the extra costs many first home buyers forget.
Quick answer: The minimum first home deposit NSW lenders will accept is usually 5% of the purchase price. With the 5% Deposit Scheme, you can avoid lenders mortgage insurance (LMI) on homes up to the price cap, which is $1.5 million in Sydney. Without the scheme, a deposit under 20% usually means paying LMI. Budget for stamp duty, legal and lender costs as well.
First Home Deposit NSW: What Does 5%, 10% and 20% Look Like?
Here is what each deposit level means in dollars on two example prices.
| Deposit | On an $800,000 home | On a $1,000,000 home | LMI usually applies? |
|---|---|---|---|
| 5% | $40,000 | $50,000 | Not under the 5% Deposit Scheme, otherwise yes |
| 10% | $80,000 | $100,000 | Yes |
| 20% | $160,000 | $200,000 | No |
These figures are the deposit only. They do not include stamp duty, legal fees or other costs, which we cover below. A larger deposit also means a smaller loan, lower repayments and less interest over time.
What First Home Deposit NSW Lenders Usually Require
Most lenders will consider a deposit from 5%, but they assess you on more than savings. They look at income, expenses, debts and credit history. Some lenders also prefer to see part of your deposit as genuine savings rather than a gift.
If your deposit is below 20%, the lender will usually charge LMI, a one-off insurance cost that protects the lender, not you. Our guide on what LMI and LVR mean shows how it is calculated and how to avoid it.
The 5% Deposit Scheme: A Smaller First Home Deposit NSW Buyers Can Use
The Australian Government’s 5% Deposit Scheme, formerly the First Home Guarantee, helps eligible buyers purchase with a deposit as low as 5% and no LMI. Housing Australia guarantees part of the loan to the lender. The rules changed on 1 October 2025:
- Income caps were removed
- The number of places became unlimited
- Property price caps rose, and the Sydney cap went from $900,000 to $1.5 million
To qualify, you generally must be a first home buyer, or not have owned property in Australia in the past 10 years, and buy a home to live in. You apply through a participating lender, not directly with Housing Australia, and the home must be under the price cap for its area.
There is a trade-off. A 5% deposit means borrowing about 95% of the price, so your loan and repayments are larger. Check that you can comfortably afford them, and read our guide on how much you can borrow.
NSW Grants and Stamp Duty Concessions That Reduce Your Costs
Stamp duty is often the biggest extra cost after your first home deposit NSW budget. NSW helps first home buyers in two main ways.
First Home Buyer Assistance Scheme (FHBAS):
- Homes up to $800,000: no stamp duty
- Homes between $800,000 and $1,000,000: reduced stamp duty
- Vacant land: no stamp duty up to $350,000, with a concession up to $450,000
First Home Owner Grant (FHOG): a $10,000 grant for eligible new homes up to $600,000. A higher limit applies to some house-and-land packages, so confirm the details with Revenue NSW. This grant does not apply to established homes.
If you buy a new home within the limits, you may receive both the grant and the stamp duty concession. Always check the current rules on the Revenue NSW website, because thresholds can change.
Other Costs on Top of Your First Home Deposit NSW
Your deposit is not the only cash you need. Plan for these costs:
- Stamp duty, if the price is above the concession thresholds
- Conveyancer or solicitor fees
- Building and pest inspections
- Lender fees and valuation fees
- LMI, if your deposit is under 20% and you are not using the scheme
- Moving costs and a buffer for the first few months
A good habit is to keep an emergency buffer after settlement. Many first home buyers feel pressure when a rate rise or an unexpected bill arrives right after they move in.
How to Save Your First Home Deposit NSW Faster
You can build a deposit with a clear plan:
- Set a target price and deposit. Work backwards from the price range you can afford.
- Automate your savings. Transfer a set amount to a separate account each pay.
- Cut or review recurring costs. Subscriptions, insurance and bank fees add up.
- Look at the First Home Super Saver Scheme (FHSSS). It may let you save for a deposit through voluntary super contributions. Check the ATO’s current rules.
- Consider help from family. Some lenders accept a gifted deposit or a guarantor, but policies vary.
- Get pre-approval early. It shows what you can borrow and what deposit you need.
First Home Deposit NSW for Western Sydney Buyers
Prices vary a lot by suburb and property type across Condell Park, Bankstown, Blacktown, Parramatta and Liverpool. Compare the homes you are considering with the $800,000 stamp duty threshold and the $1.5 million 5% Deposit Scheme cap. A home just under a threshold can save you thousands.
A local broker can explain which lenders participate in the scheme and how each lender treats savings, gifts and income. Housing Australia reported that 77% of Home Guarantee Scheme loans came through brokers in the last financial year. If you are still deciding who to use, read our guide on mortgage broker vs bank, and see how much a mortgage broker costs.
Frequently Asked Questions
What is the minimum first home deposit NSW lenders accept?
Usually 5% of the purchase price. With the 5% Deposit Scheme you can avoid LMI if you meet the rules and buy under the price cap. Outside the scheme, a deposit below 20% normally means paying LMI.
Do first home buyers pay stamp duty in NSW?
Not always. Eligible first home buyers pay no stamp duty on homes up to $800,000 and a reduced amount up to $1,000,000. Above that, full stamp duty usually applies.
How much deposit do I need for an $800,000 home?
A 5% deposit is $40,000, a 10% deposit is $80,000 and a 20% deposit is $160,000. You also need money for costs such as legal fees, inspections and any LMI.
Can I use a gift from family as a deposit?
Some lenders accept gifted funds, but policies differ and some want part of the deposit to be genuine savings. Ask your broker before you rely on a gift.
Can I get the First Home Owner Grant and the stamp duty exemption together?
Yes, if you buy an eligible new home within the limits. The FHOG applies only to new homes, while the stamp duty concession covers both new and established homes within its thresholds.
Talk to a Local Mortgage Broker in Condell Park
Not sure how large a first home deposit NSW lenders will need from you? Book a free, no-obligation consultation with LL Global Group. We will check the schemes you may qualify for, compare lenders and explain every step in plain English.