What First-Home Buyers in 2025 need to know
Buying your first home is one of life’s biggest milestones, but lately the great Australian dream has felt a lot more like a marathon. Between rising prices, limited supply and endless paperwork, it’s easy to feel like home ownership is slipping further away.
That’s why the Australian Government’s updated 5% Deposit Scheme that launched on the 1st October is such welcome news. This update genuinely makes it easier for first-home buyers to get into the market faster and with less stress.
As someone who has helped hundreds of first-time buyers find their way, I can honestly say this is one of the most exciting changes we’ve seen in years.
Read on to learn more or feel free to contact me at claire@venro.com.au or on 0403 481 570 to have an obligation free conversation.
What is the 5% deposit scheme?
In simple terms, the Australian Government 5% Deposit Scheme allows eligible first-home buyers to purchase a property with as little as a 5% deposit and avoid paying Lenders’ Mortgage Insurance (LMI). Depending on how much you purchase a property for, you may still need to set aside money for stamp duty, legal costs, etc too.
Normally, if you have less than a 20% deposit, lenders charge LMI to protect themselves (not you). It can add tens of thousands to your upfront costs. Under this scheme, the government acts as a guarantor for up to 15% of the property value. This means your lender could approve your loan application with just a 5% deposit and you don’t have to pay LMI at all.
It’s a simple change that can take years off the grind of saving and make home ownership possible much sooner.
What’s new in 2025
The 2025 update makes the scheme more inclusive, flexible and practical for real-world buyers. Here’s what’s changing:
- No income limits – This is a major change from previous years, the government has removed the income caps that used to apply. This means first-home buyers of all income levels, from professionals to young families, can now access the scheme.
- Unlimited places – No more capped numbers or stressful race-to-apply windows. If you’re eligible, you can access it when you’re ready.
- Higher property price caps – Reflecting today’s market values:
- Brisbane: up to $1 million
- Sydney: up to $1.5 million
- Melbourne: up to $950,000
This brings the scheme in line with current property prices, especially in major cities where first-home buyers have struggled to compete.
How the scheme works
Here’s how it comes together in practice:
- You save a 5% deposit using genuine savings, aka money you’ve built up yourself over time, not a gift or loan.
- The Australian Government guarantees up to 15% of the property’s value to your lender.
- Because of that guarantee, you don’t need a 20% deposit therefore you won’t pay LMI.
- Venro and your lender handle your loan application like any other – the only difference is the government is backing a portion of it.
The upside is that you will have lower upfront costs, quicker entry into the market and significant long-term savings.
Why Avoiding LMI Matters
If you’re new to the process, Lenders’ Mortgage Insurance (LMI) can feel like one of those “surprise” costs that nobody warns you about. It’s a one-off fee that protects the lender, not you, when your deposit is under 20%.
Depending on the property value, it can range anywhere from $10,000 to $40,000+. It doesn’t build your equity and it gets capitalised to your loan which in turn increases your loan repayments.
With the new 5% Deposit Scheme, you skip that cost completely. For many of my Brisbane clients buying in the $800,000 – $1 million range, that’s an instant saving of around $30,000 or more; money that stays in your pocket or goes toward your new home.
Eligibility at a glance
To qualify, you’ll need to:
- Be an Australian citizen or permanent resident
- Be at least 18 years old
- Be a first-home buyer or have not owned property or land in the last 10 years in Australia
- Have a minimum 5% deposit made up of genuine savings
- Plan to live in the property as your main home
That’s it! No income caps, no limited spots, no mad dash to apply.
The only thing you’ll really need is expert guidance to help you figure out what’s comfortable for your budget and to make the process smooth from start to finish – that’s exactly what my team and I at Venro are here for.
What it means for Brisbane buyers
Here in Brisbane, the new $1 million price cap opens up a lot more choice for first-home buyers, from townhouses and family homes to inner-city apartments that were previously out of reach.
For example, a couple earning a combined income of around $180,000 could now potentially buy a $900,000 home with a $45,000 deposit and no LMI (plus additional sufficient funds to cover stamp duty, legal costs, etc). That’s roughly a $30,000 saving upfront, without needing to spend years scraping together a full 20% deposit.
For many, it means the difference between waiting and watching while property prices continue to rise and walking through the door of your first home.
Feeling nervous? You’re not alone
Most first-home buyers tell me they’re worried about one (or all) of these:
- “Can I actually afford it?”
The good news is the 5% Deposit Scheme makes home ownership genuinely more achievable. We’ll help you work out your borrowing capacity and repayments that feel comfortable, not stressful. - “I don’t even know where to start.”
That’s what we’re here for. At Venro, we break it down step-by-step, from pre-approval through to settlement, so you always know what’s next and never feel lost in the process. - “What documents do I need?”
We’ve got that covered too. We’ll help you pull everything together. Usually you will need payslips, ID, savings history, but everyone’s situation is unique. We will liaise directly with the lender so the process will be as smooth as possible.
At Venro we are all about making the process simple, transparent and stress-free.
Next steps: How to get started
If you’re thinking about taking advantage of the First Home Buyer Scheme, a bit of preparation will put you in the best position.
Here’s what you can do:
- Check your savings and budget.
Look at your income, expenses and how close you are to that 5% deposit. Remember to factor in stamp duty, conveyancing and moving costs when looking at your savings. - Get advice early.
Reach out to us at Venro. We’ll help you understand what you can borrow, how the scheme fits your situation and which lenders are offering the best options. - Explore your property options.
With the higher caps, you might be pleasantly surprised at what’s now within reach in Brisbane’s market.
Final thoughts
The Australian Government 5% Deposit Scheme is a real win for first-home buyers, removing the income limits, lifting property price caps, and scrapping the yearly quotas that used to make things complicated.
For Brisbane buyers especially, it’s a golden opportunity to make that first home a reality. And if you’re feeling unsure where to begin, that’s okay. You don’t have to figure it out alone. At Venro, our job is to make your home buying journey simple, transparent, and genuinely enjoyable. We’ll guide you through every step, from checking eligibility to loan approval, so you can move into your first home with confidence (and a lot less stress).
Buying your first home should feel exciting. With the 5% Deposit Scheme, it finally can.
Contact Claire: claire@venro.com.au / 0403 481 570