How to Buy Your First Home With a Low Deposit in Melbourne (2026)
First home buyers in Melbourne can purchase a brand-new home with approximately $30,000 total upfront. That’s not a typo. While most people assume they need $80,000 or more saved before they can even think about buying, the reality is dramatically different when you structure the purchase correctly — using the 5% Deposit Scheme, stamp duty exemptions on new builds, and the Victorian $10,000 First Home Owner Grant.
Low Deposit Homes has helped over 826 families across Australia become homeowners using this exact approach. This guide covers everything Melbourne first home buyers need to know — the grants you’re eligible for, exactly how much you need, where to buy, and the step-by-step process from first call to getting your keys.
Every number in this guide is current as of April 2026 and independently verifiable against government sources.
How much deposit do you actually need in Melbourne?
The answer depends entirely on whether you buy a brand-new home or an established property. The difference is significant — and it’s the reason Low Deposit Homes exists.
Here’s the real comparison for a $750,000 property in Melbourne’s growth corridors:
New build house and land package with Low Deposit Homes (5% Scheme)
Cost | Amount |
Purchase price | $750,000 |
Deposit (5%) | $30,000 |
Stamp duty | $0 (land component exempt for first home buyers in Victoria) |
Lenders Mortgage Insurance (LMI) | $0 (government guarantee under 5% Deposit Scheme) |
First Home Owner Grant | -$10,000 (reduces cash needed) |
Land transfer fees | $0 |
Legal and settlement costs | ~$4,000 |
Total upfront cash needed | ~$30,000 |
The $10,000 FHOG is paid at settlement, so depending on timing it either reduces your upfront cash to approximately $30,000 or offsets costs at completion.
Established property at $750,000 (with 5% Deposit Scheme—FHLDS eligible):
Cost | Amount |
Purchase price | $750,000 |
Deposit (5%) | $37,500 |
Stamp duty | $40,070 |
Lenders Mortgage Insurance (LMI) | $0 (government guarantee under 5% Deposit Scheme) |
Land transfer fees | $1,864 |
Mortgage registration fees | $132 |
Legal fees | $1,500 |
Lender fees | $500 |
Total funds required | ~$82,000 |
Even with the 5% Deposit Scheme removing LMI on an established property, you still need approximately $82,000 in savings because of stamp duty ($40,070) and associated purchase costs.
The gap: over $44,500 saved by buying a new build
When you buy a new build through Low Deposit Homes, the stamp duty exemption alone saves you over $40,000. Combined with the $10,000 FHOG and zero LMI, you need roughly half the cash compared to buying established — even when both use the 5% Deposit Scheme.
Without the 5% Deposit Scheme on an established property, the gap is even wider. A 10% deposit ($75,000) plus stamp duty ($40,070) plus LMI (approximately $15,000 to $20,000) means you’d need $130,000 or more in savings. That’s nearly four times what you need for a new build with Low Deposit Homes.
What grants are available for Melbourne first home buyers?
5% Deposit Scheme (No LMI)
The Australian Government’s 5% Deposit Scheme (formerly the First Home Guarantee) allows eligible first home buyers to purchase with just a 5% deposit. The government guarantees the remaining 15% to your lender, so you don’t need the traditional 20% deposit and you pay zero Lenders Mortgage Insurance.
Key facts as of April 2026:
- Minimum deposit: 5% of the property value
- Lenders Mortgage Insurance: waived entirely
- Income caps: removed as of October 2025 — no income limits
- Place limits: removed — no waitlists, unlimited spots
- Property price cap: $950,000 in Melbourne and metro Victoria; $650,000 in regional Victoria
- Property types: new builds, existing homes, house and land packages, off-the-plan purchases, vacant land with a building contract
- Eligibility: Australian citizen or permanent resident, aged 18 or older, have not owned property in Australia in the past 10 years
What this means in dollars: For a $750,000 house and land package in Wollert, your deposit is $30,000. Without the scheme, you would need approximately $150,000 (20% deposit) to avoid LMI, or pay LMI of $15,000 to $20,000 on top of a smaller deposit.
$10,000 First Home Owner Grant (FHOG)
Victoria offers a $10,000 cash grant for first home buyers purchasing or building a new home valued under $750,000. The grant is paid at settlement and directly reduces the cash you need upfront.
Melbourne’s growth corridors have genuine stock available at price points that qualify for this grant. House and land packages from $680,000 to $750,000 are available across multiple corridors, making the FHOG a realistic benefit — not just a theoretical one.
Eligibility: Australian citizen or permanent resident, both applicants must be 18+, must not have previously owned or received a first home owner grant in any Australian state, the property must be a new home valued under $750,000, and you must move in within 12 months and live there for at least 12 continuous months.
Stamp Duty Exemption on Land
Victorian first home buyers receive a stamp duty exemption on the land component of their house and land package purchase. The building component is a construction contract, not a property transfer, so stamp duty does not apply to the build.
For a $750,000 house and land package, this saves approximately $40,000 compared to buying an established property at the same price. This single exemption is the largest cost saving available to first home buyers in Victoria and the primary reason the deposit gap between new and established is so large.
Help to Buy (Federal Shared Equity)
Help to Buy is a federal government scheme where the government contributes up to 40% of the purchase price of a new home. You need a minimum 2% deposit.
For a $750,000 new build in Melbourne:
- Your deposit: $15,000 (2%)
- Government contribution: up to $300,000 (40%)
- Your home loan: $435,000 (58%)
- Weekly repayments: approximately $530 to $580 (compared to $900+ on a full $712,500 loan)
Eligibility: Australian citizenship required (not permanent residency), household taxable income under $160,000, individual income under $100,000.
The government’s share is valued at the future market value when you eventually sell or buy them out. You can “staircase” out by paying off the government’s share over time as your income increases.
Important: Help to Buy and the 5% Deposit Scheme cannot be used together on the same purchase. Low Deposit Homes assesses your situation and advises which scheme delivers the better outcome for you.
First Home Super Saver Scheme (FHSSS)
You can withdraw voluntary superannuation contributions (up to $50,000 for individuals, $100,000 for couples) to use toward your first home deposit. This effectively allows you to save for your deposit using pre-tax income, which can reduce your tax and accelerate your savings.
How it works: You make additional voluntary contributions to your super fund, then apply to withdraw them (plus deemed earnings) when you’re ready to buy. Because you’re saving through super, you pay 15% contributions tax instead of your marginal tax rate — which for most first home buyers means a significant tax saving on every dollar directed toward their deposit.
Where can you buy in Melbourne?
Low Deposit Homes operates across Melbourne’s three major growth corridors. Each has active estates with house and land packages structured for first home buyer affordability and priced to stay within government scheme thresholds.
South East Corridor
Suburbs: Pakenham, Cranbourne, Officer, Clyde, Berwick
Packages from: approximately $800,000 to $950,000
The South East is Melbourne’s most established growth corridor. Train lines connect Pakenham and Officer directly to the CBD. Schools, shopping centres, and medical facilities are well established. Cranbourne and Clyde offer newer estates with modern community infrastructure including parks, walking trails, and retail precincts.
Why first home buyers choose the South East: Strong public transport connections, established schools and childcare, proximity to employment in Dandenong and the CBD,
North Corridor
Suburbs: Craigieburn, Mickleham, Donnybrook, Kalkallo, Beveridge
Packages from: approximately $680,000 to $850,000
The North corridor offers some of Melbourne’s most affordable new build options. Craigieburn has matured significantly with its own town centre, while Mickleham and Donnybrook represent the next wave of development with brand-new estates and modern community planning.
Why first home buyers choose the North: Lower entry prices, new estate developments with contemporary designs, proximity to Melbourne Airport and Hume employment corridor, and rapid infrastructure investment including the upcoming Outer Suburban Arterial Roads programme.
West Corridor
Suburbs: Werribee, Point Cook, Tarneit, Wyndham Vale, Melton
Packages from: approximately $700,000 to $880,000
The West has experienced rapid growth and significant infrastructure investment. Werribee and Point Cook are well-established suburbs with strong community facilities. Tarneit and Wyndham Vale offer newer estates with packages priced competitively for first home buyers.
Why first home buyers choose the West: Strong employment growth around Werribee and the Western Employment Corridor, good school options, community sporting facilities, and competitive pricing with a wide range of lot sizes.
Choosing the right corridor
Every corridor has different soil conditions, council requirements, and estate timelines. Low Deposit Homes evaluates every block for factors like soil classification (reactive vs stable), BAL ratings (bushfire), and flood mapping that can add $30,000 to $50,000 in unexpected construction costs if not identified upfront. This due diligence is included in the service — you don’t pay extra for it.
What is the step-by-step process?
Step 1: Free consultation (15 minutes)
You speak with a Low Deposit Homes property advisor who assesses your income, savings, and eligibility for government schemes. We’ll tell you exactly how much deposit you need based on your specific situation. There is no cost and no obligation.
Step 2: Finance pre-approval (1 to 2 weeks)
We connect you with specialist first home buyer mortgage brokers who secure pre-approval from lenders experienced with the 5% Deposit Scheme. Different lenders have different policies on genuine savings, gift deposits, and HECS/HELP debt treatment — we match you with the lender that suits your situation.
Step 3: Land selection and Expression of Interest (1 to 4 weeks)
Based on your approved budget, we match you with available land in your preferred corridor. We assess every block for hidden cost risks — soil type, slope, bushfire rating, flood mapping — before you commit. You place an Expression of Interest to hold your selected lot.
Step 4: Contracts and formal finance (2 to 4 weeks)
Land contract and building contract are prepared as separate documents. Finance moves from pre-approval to formal (unconditional) approval. At this stage, 95% of Low Deposit Homes clients have full bank approval before committing — your purchase is secure before you sign anything binding.
Step 5: Land registration (3 to 12 months)
If the estate is still under development, you wait for land titles to be registered with the council. During this time, you continue renting and can continue saving. Your contracts are locked in at today’s prices — so you’re protected from price increases while the estate develops.
Step 6: Construction (6 to 9 months)
Your home is built to the specifications in your fixed-price building contract. Low Deposit Homes manages the builder relationship and keeps you informed at every stage — slab, frame, lockup, fixing, and completion. The fixed-price contract means no cost surprises.
Step 7: Settlement and move-in (2 to 4 weeks after completion)
Final inspection, settlement, and you receive the keys to your brand-new home. Low Deposit Homes celebrates every settlement with door bows, flowers, and champagne — because buying your first home should feel like the milestone it is.
Total timeline: 12 to 24 months from first consultation to moving in, depending on estate development timelines.
How much income do you need?
Most Low Deposit Homes clients in Melbourne are couples with a combined household income of $130,000 or more and approximately $30,000 to $45,000 in accessible savings. However, every situation is different and Melbourne’s lower price points compared to other major Australian markets mean borrowing capacity goes further.
Key factors banks assess: –
- Combined gross income
- Existing debts (personal loans, car loans, HECS/HELP, credit cards)
- Living expenses and number of dependants
- Savings history (3 months of genuine savings or rental history)
- Credit history
Banks apply a buffer rate — typically 3% above the current interest rate — when assessing affordability. This means if rates are at 6%, the bank tests whether you can afford repayments at 9%. This protects you from future rate increases.
A 15-minute consultation with Low Deposit Homes can give you a clear picture of your borrowing capacity and the deposit you need. There is no cost and no obligation.
Frequently Asked Questions
Can I qualify for both the $10,000 FHOG and the 5% Deposit Scheme?
Yes. These are separate schemes administered by different bodies. You can use the 5% Deposit Scheme (federal — Housing Australia) and the $10,000 FHOG (state — State Revenue Office Victoria) on the same purchase. This is the standard approach for Low Deposit Homes clients in Melbourne.
Do I pay stamp duty on a house and land package in Victoria?
As a first home buyer purchasing a new home, you receive a stamp duty exemption on the land component. The building component of a house and land package is a construction contract, not a property transfer, so stamp duty does not apply to the build. This is the single largest cost saving available to Victorian first home buyers.
What's the difference between Help to Buy and the 5% Deposit Scheme?
The 5% Deposit Scheme removes the need for LMI — you still borrow 95% of the property value and make full repayments. Help to Buy reduces how much you borrow — the government owns a share of the property, so your loan and repayments are significantly lower. They cannot be used together on the same purchase. Low Deposit Homes will advise which is better for your specific situation.
Can I use the 5% Deposit Scheme if my partner has owned property before?
Yes. If one partner has not owned property in the past 10 years, the purchase can be structured in that partner’s name to maintain eligibility for the 5% Deposit Scheme. The other partner can maintain equitable interest without being on the title. This is a common structuring approach and is perfectly legal.
Do I need genuine savings or can I use a gift deposit?
Different lenders have different policies. Some lenders accept 3 months of rental history as evidence of genuine savings. Others are more flexible with gift deposits and don’t require source-of-funds documentation in the same way. Low Deposit Homes matches you with the lender that best suits your deposit source and financial situation.
What if the property value comes in lower than the purchase price?
If the bank’s valuation is lower than the contract price, your broker can request a revaluation with additional comparable sales evidence, or we can negotiate the purchase price. This is rare with house and land packages because builder pricing is typically consistent with market valuations.
How much are weekly repayments on a $750,000 home?
With a 5% deposit ($37,500), your loan would be approximately $712,500. At a 6.2% interest rate over 30 years, weekly repayments are approximately $840. Under Help to Buy, the government contributes up to 40%, reducing your loan to $435,000 and weekly repayments to approximately $530 to $580.
Is Low Deposit Homes free to use?
Yes. There is no cost to the buyer. Low Deposit Homes earns a commission from the builder when the home is completed and settled. There are no upfront fees, no hidden charges, and no obligation at any stage of the process.
How is Low Deposit Homes different from a mortgage broker?
A mortgage broker helps with finance only. Low Deposit Homes manages the entire journey — finance structuring, land selection, builder coordination, government grant applications, and ongoing support through construction to settlement. We are a full-service first home buyer specialist, not just a loan originator.
What is the property price cap for the 5% Deposit Scheme in Victoria?
The property price cap is $950,000 in Melbourne and metro Victoria, and $650,000 in regional Victoria. Most house and land packages in Melbourne’s growth corridors ($680,000 to $780,000) sit comfortably under the metro cap with room to spare.
Ready to find out what you need?
Book a free 15-minute consultation with a Low Deposit Homes property advisor. We’ll assess your income, savings, and eligibility for Victorian government schemes — and give you a clear picture of exactly how much you need to buy your first home in Melbourne.
No cost. No obligation. Just straight answers.
Call us: 1800 920 172 (available 7 days, 8am to 7:30pm)
Low Deposit Homes operates under Winning Homes Australia Pty Ltd (ACN 633 321 758). All deposit calculations are indicative and based on general scenarios. Individual circumstances may vary. Government grant eligibility is subject to assessment by the relevant authority. This guide is for informational purposes and does not constitute financial advice. Consult a qualified financial adviser for advice specific to your situation