The short answer: often less than you think. Here's how deposits really work across Nunawading, Blackburn, Box Hill and surrounds — and the schemes that can get you in sooner.
The short answer: most lenders want 20% to avoid Lenders Mortgage Insurance, but many buyers in Melbourne’s east get in with 5% — and some with less. How much you actually need depends on the price, whether you’re a first home buyer, and the upfront costs that sit on top of the deposit.
The 20% rule — and why it isn’t a rule
Twenty per cent is the point where most lenders stop charging Lenders Mortgage Insurance (LMI). On an $800,000 home in Nunawading or Blackburn, that’s $160,000 — a number that keeps a lot of people renting longer than they need to. Plenty of lenders will happily lend at 90% or even 95% of the price; you simply pay LMI on top, which can often be added to the loan rather than paid in cash.
Buying with 5% and no LMI
The federal Home Guarantee Scheme lets eligible first home buyers purchase with a 5% deposit while the government guarantees the gap to 20%, so there’s no LMI to pay. On that same $800,000 home, the deposit drops to $40,000. Single parents may qualify for the Family Home Guarantee with as little as 2%. Price caps and lender participation apply, so it pays to check which panel lenders are offering it before you start bidding. Our guide to Victorian first home buyer grants and schemes explains how they stack together.
Family help: the guarantor option
If your parents have equity in their own home, a family guarantee can secure part of your loan instead of cash. It can mean buying with little or no deposit and no LMI. It’s a real commitment for the guarantor, so we always walk both sides through how it works and how the guarantee is released once your equity builds.
Don’t forget the costs on top of the deposit
The deposit isn’t the whole cheque. Stamp duty is the big one: first home buyers in Victoria pay none on homes up to $600,000 and a reduced amount up to $750,000, but above that it’s charged in full — tens of thousands of dollars on a typical eastern suburbs house. Add conveyancing, building and pest inspections, and loan and transfer fees. Run your numbers through our stamp duty calculator before you set a budget.
The right deposit strategy depends on your income, savings, family situation and target suburb — and it changes which lenders we shortlist. Tudor Finance has helped buyers across Nunawading, Blackburn, Box Hill and Mitcham into homes since 2007. Call (03) 9894 7135 for a free chat.
This article is general information only and doesn’t consider your personal circumstances. Scheme details, price caps and stamp duty thresholds change — we’ll confirm current eligibility when we talk. Tudor Finance Pty Ltd, Australian Credit Licence 393142.
