When to Lock In Your Budget Before You Start Looking

Your budget isn't what you think you can borrow. It's what you can borrow minus what you'll pay to get there, plus what the government will kick in if you qualify, minus what gets eaten by stamp duty unless you're exempt.

Most buyers start shopping before they've worked that out. They find a property, fall in love with it, then discover their deposit is $8,000 short or their income doesn't qualify them for the scheme they were counting on. At that point, your options narrow fast.

This is about getting the numbers locked in before you start looking, not after you've signed an offer.

Work Out Your Deposit Source Before You Pick a Scheme

You need to know where your deposit is coming from before you decide which government scheme to apply for, because not every deposit structure fits every program.

Say you've saved $35,000 and your parents are gifting another $20,000. That gives you $55,000 to work with. You're looking at the Australian Government 5% Deposit Scheme, which means you can borrow against a property worth up to $1,100,000 depending on location, with a 5% deposit and no lenders mortgage insurance. Your $55,000 covers the deposit and leaves room for legals, building inspections, and settlement costs.

But if you're considering Help to Buy instead, you need a minimum 2% deposit and the government contributes up to 30% or 40% depending on whether the property is established or new. Your $55,000 still works, but now you're splitting equity with the government and you'll need to buy them out later or repay on sale. The deposit amount isn't the constraint, the equity trade-off is.

If your deposit includes funds from the First Home Super Saver Scheme, you'll need an ATO determination before you exchange contracts. That takes time. If you're relying on a bonus or a tax return that hasn't landed yet, your timeline just became conditional on something outside your control.

Gifted deposits are accepted by most lenders, but the lender will ask for a signed declaration confirming the funds are a gift, not a loan. If your parents expect repayment, that changes your borrowing capacity because it's treated as a liability.

Map Your Income Against the Scheme Caps That Actually Apply

Income caps determine whether you're eligible for Help to Buy, some state shared equity programs, and certain stamp duty concessions. The Australian Government 5% Deposit Scheme removed income caps in October 2025, but Help to Buy still applies a $100,000 limit for individuals and $160,000 for couples or single parents.

If you earn $95,000 and your partner earns $70,000, your combined income is $165,000. You're over the Help to Buy cap by $5,000, so that program is out. You can still use the 5% Deposit Scheme, but you won't get the government equity contribution. If you were counting on that 30% or 40% top-up to afford the property you wanted, your purchase price just dropped or your deposit requirement just went up.

Income is assessed on your most recent Notice of Assessment unless you've changed jobs or had a pay rise since your last tax return. If your income has increased mid-year, some lenders will accept payslips and an employment letter, but the ATO determination for Help to Buy still uses your last lodged return. If that return shows you under the cap but your current income puts you over, you may be declined at settlement.

In our experience, buyers who are borderline on income caps often assume they'll scrape through, then find out at pre-approval that their assessable income includes overtime, bonuses, or rental income they hadn't factored in. That pushes them over the threshold.

If you're self-employed, your assessable income is your taxable income after deductions, not your revenue. A sole trader showing $180,000 revenue but $85,000 taxable income will meet the Help to Buy individual cap. A couple running a company that pays them $80,000 each in salary but retains another $60,000 in the business will be assessed on the $160,000 combined salary, not the retained earnings. Structure matters.

Price Caps and Property Type Restrictions Change What You Can Buy

Every state and federal scheme applies a property price cap, and most apply restrictions on property type. If you're targeting a suburb where the entry price sits above the cap, the scheme won't help you.

The 5% Deposit Scheme allows purchases up to $1,500,000 in Sydney, $950,000 in Melbourne, $1,000,000 in Brisbane, with lower caps in regional areas. Help to Buy applies separate caps that vary by state and region, generally lower than the 5% Deposit Scheme. In Victoria, the Help to Buy cap is $950,000 in Melbourne and $700,000 in regional areas. If you're buying in a suburb where the median sits at $980,000, you can use the 5% Deposit Scheme but not Help to Buy.

Some schemes exclude apartments above a certain number of storeys, properties on leasehold title, or land larger than a set area. Help to Buy excludes investment properties entirely and requires you to occupy the property as your principal place of residence. The NSW First Home Buyers Assistance Scheme provides a stamp duty exemption on properties up to $800,000, but if you're buying at $850,000, you'll pay duty on a sliding scale. At $1,000,001, you pay full duty.

Consider a buyer looking in Brisbane's inner suburbs. The median unit price is sitting around $650,000. They qualify for the Queensland first home owner grant of $30,000 if they buy new, but that grant doesn't apply to established apartments. If they were counting on the grant to cover part of their deposit and they've only looked at established stock, they'll need to find that $30,000 from another source or switch to a new build.

Property type also affects your loan structure and features. Some lenders don't offer offset accounts or redraw facilities on loans backed by the 5% Deposit Scheme. Others do, but only with certain loan products. If you're assuming you'll have an offset account to park your savings and reduce interest, confirm that with your broker before you settle on a property, not after you've signed.

State Concessions Stack With Federal Schemes But Not Always With Each Other

You can use the Australian Government 5% Deposit Scheme alongside your state's first home buyer stamp duty concession and first home owner grant, provided you meet the eligibility criteria for each. You cannot combine Help to Buy with the 5% Deposit Scheme, but in most states you can still access stamp duty concessions and grants while using Help to Buy.

In Victoria, a first home buyer purchasing an established home for $650,000 pays no stamp duty, can use the 5% Deposit Scheme to borrow with a 5% deposit, and won't pay lenders mortgage insurance. They don't get the $10,000 first home owner grant because that only applies to new builds, but the stamp duty saving is around $34,000. If they'd purchased at $780,000, they'd pay partial duty on the amount above $750,000.

In Queensland, a buyer purchasing a new home under $750,000 can claim the $30,000 first home owner grant and access the full transfer duty concession on new builds introduced in May 2025, which has no price cap on residential land. If they use the 5% Deposit Scheme, they're also exempt from LMI. Those concessions stack.

But a Queensland buyer purchasing an established home at $750,000 gets the transfer duty concession because the property is under $800,000, and can use the 5% Deposit Scheme, but doesn't get the $30,000 grant because the property isn't new. If they were relying on that grant to top up their deposit and they've only got 5% saved, they'll need to find another $30,000 or buy new instead.

Tasmania offers a $30,000 first home owner grant or a full duty exemption on established homes up to $750,000, but you can't claim both on the same property. The grant applies to new builds, the duty exemption applies to established homes. You pick the one that applies to the property type you're buying, not the one that sounds bigger.

In South Australia, the first home owner grant is $15,000 for new builds with no price cap from June 2024 onward. The transfer duty concession for new homes and vacant land also has no price cap from May 2025. A buyer purchasing a new build at $900,000 gets the grant and pays no stamp duty, and can combine that with the 5% Deposit Scheme. A buyer purchasing an established home at $750,000 pays no duty under the established home concession but doesn't get the grant.

Western Australia recently expanded its stamp duty concessions for transactions from March 2025 onward. In the Perth metro and Peel regions, concessions now apply on properties up to $700,000, and up to $750,000 outside those areas. The first home owner grant is $10,000 for new homes under the value cap, which varies by location. The grant and the duty concession can be stacked with the 5% Deposit Scheme, but if you're buying in a regional area and the property is above the cap, you won't get the grant even though you still qualify for the duty concession and the federal scheme.

Don't assume every concession you've read about will apply to your purchase. Run your specific property type, price, and location through the eligibility rules for your state before you make an offer.

Lock In Pre-Approval With the Loan Features You Actually Need

Pre-approval is not a guarantee, but it does confirm a lender is willing to lend you a specific amount based on your current income, deposit, and credit position. It also locks in the loan product, the interest rate type, and the features that come with it.

If you're approved for a variable rate loan with an offset account and redraw, you know what you're working with. If you're approved for a fixed rate loan with no offset and limited redraw, you know you'll be parking any extra savings elsewhere and you won't have the same flexibility to make extra repayments without hitting a cap.

Pre-approval is valid for three to six months depending on the lender, and it's conditional on the property valuation, your financial position staying the same, and no changes to your employment or credit file. If you get pre-approved in March and you don't buy until September, you'll need to reapply. If you change jobs, take on a car loan, or rack up $12,000 on a credit card in the meantime, your borrowing capacity will drop.

Some buyers skip pre-approval because they think it's only useful once they've found a property. But without it, you don't actually know what you can borrow. Borrowing capacity calculators give you an estimate, but lenders assess your income, living expenses, and existing debts differently. One lender might assess your overtime and rental income at 80%, another at 100%. One might add a buffer to your living expenses, another might use your declared figures. Pre-approval tells you what a specific lender will actually lend you, not what a calculator guesses.

If you're using a low deposit scheme, some lenders apply higher interest rates or restrict access to discounted loan products. A 5% deposit loan might come with a rate 0.15% to 0.30% higher than a loan with a 20% deposit, depending on the lender and the scheme. Over a 30-year loan, that difference compounds. Your broker should be showing you what the rate and product restrictions are before you commit to a lender, not after you've signed.

Call one of our team or book an appointment at a time that works for you. We'll map your deposit, income, and the schemes you're eligible for against the suburbs and property types you're targeting, and get you pre-approved with a loan structure that actually fits how you want to use it.

Frequently Asked Questions