Why use this calculator
The price on the listing is not what a first purchase costs. Between the deposit, transfer duty, lenders mortgage insurance, conveyancing, searches and a building inspection, buyers routinely discover twenty or thirty thousand dollars of settlement costs after the contract is already signed. This calculator puts every one of those numbers on one screen before you start inspecting, using your own state's duty scale and first home concession rather than a national average that applies nowhere.
It also shows what the First Home Guarantee is worth in hard cash, because the difference between a five per cent deposit with the guarantee and a ten per cent deposit without it is usually tens of thousands of dollars in insurance you never get back.
Seeing the deposit ladder side by side is what turns a vague savings goal into a target with a date attached.
How to use it
- Choose the state or territory where the property sits, because duty follows the property rather than your address.
- Enter the purchase price you are aiming at, which for a first pass should be the top of your search range rather than a bargain you hope to find.
- Your deposit is every dollar you can put towards the purchase, including a family gift and anything you can release under the First Home Super Saver scheme, which your myGov account shows as a determination.
- Household income before tax is the combined gross salary of everyone who will be on the loan, taken from the year to date figure on your latest payslips.
- Set the property type, because grants apply only to new builds and South Australia limits its duty relief the same way.
- Choose whether you expect to use the First Home Guarantee, then enter the advertised rate and term of the loan you are comparing.
What each result means
- Loan required
- The amount you need to borrow after your deposit. Everything else on the page, from insurance to the repayment, follows from this number.
- Extra deposit to reach 20%
- How much more deposit you would need for it to reach twenty per cent of the purchase price. At that level lenders do not charge mortgage insurance, with or without the First Home Guarantee.
- Borrowing headroom (five times income)
- How far your loan sits below five times your gross income, the rough borrowing limit used here. It is a guide only, because lenders assess your expenses, debts and a buffer on the interest rate.
- Loan above five times income by
- How far the loan you need exceeds five times your gross income. Expect a lender to look harder at your expenses, or to need a larger deposit or a cheaper property by about this amount.
- Deposit as a share of price
- Your deposit expressed as a percentage of the purchase price. Twenty per cent is the level at which mortgage insurance disappears entirely.
- Transfer duty after first home concession
- The duty your state would charge you as an eligible first home buyer, payable in cash at or shortly after settlement.
- Duty saved by the concession
- The gap between the general rate and what you pay. In several states this saving vanishes a dollar above the threshold.
- Lenders mortgage insurance (est.)
- A one off premium that protects the lender, not you, charged when your deposit is under twenty per cent and you are not using the guarantee.
- First Home Owner Grant (indicative)
- The cash grant your state pays first home buyers of new homes. Established homes attract no grant anywhere in Australia.
- Conveyancing, searches and inspections
- A working allowance for the conveyancer or solicitor, title and council searches, and a building and pest inspection.
- Cash needed at settlement
- The total you must actually have in the bank on the day. This is the savings target, not the deposit on its own.
- Estimated borrowing capacity
- A rough ceiling at five times gross household income. Lenders assess your real expenses, debts and a buffer rate on top of the advertised rate.
- Estimated monthly repayment
- Principal and interest at the rate and term you entered. Lenders test whether you can still pay it about three percentage points higher.
The formula
Loan equals price less deposit, and the loan to value ratio is loan divided by price. Duty is the state scale in src/lib/stamp-duty-au.ts, reduced by the first home concession: nil below the exempt threshold, then phased linearly to the full amount at the concession threshold. Mortgage insurance is the loan multiplied by an indicative premium rate that steps at eighty, eighty five, ninety and ninety five per cent LVR, and is nil under the First Home Guarantee. The repayment is the standard amortised payment, P multiplied by i divided by one minus one plus i to the power of minus n, where i is the annual rate divided by twelve and n is the term in months. Borrowing capacity is five times gross household income, a lender rule of thumb rather than a serviceability assessment.
How this number is used in practice
The single decision that moves the numbers most is not the price, it is whether you use the First Home Guarantee. Buying at $850,000 with a ten per cent deposit and no guarantee attracts roughly sixteen thousand dollars of mortgage insurance, a premium that is usually capitalised onto the loan and then carries interest for thirty years.
The same purchase under the guarantee costs nothing in insurance, which is why buyers who qualify often stop saving at the five per cent mark and buy a year or two earlier. The trade off is a bigger loan, a higher repayment and less equity buffer if prices fall, so the guarantee is a timing tool rather than free money.
The other lever is the duty threshold. Concessions are cliffs, not slopes, in the sense that a purchase a little above the exempt threshold can cost thousands more than one just under it. In New South Wales a first home buyer pays nothing at eight hundred thousand and thousands immediately above it, and the same structure repeats in Victoria, Queensland and Western Australia at their own numbers.
If you are negotiating close to a line, the saving from getting under it is often worth more than the price difference you are arguing about.
Grants are narrower than the advertising suggests. Every state limits its First Home Owner Grant to newly built or substantially renovated homes, applies a value cap, and requires you to live in the property for a continuous period soon after settlement. Buying with a partner who has previously owned residential property anywhere in Australia can disqualify the whole purchase in some jurisdictions, so check the eligibility rules on your revenue office site before you count the grant in your budget.
Worked examples
$850,000 established home in New South Wales, ten per cent deposit, guarantee used
A $765,000 loan, about $8,109 of duty after the sliding concession, no mortgage insurance, and roughly $95,809 of cash needed at settlement.
$700,000 new build in Queensland, five per cent deposit, guarantee used
No duty at all because Queensland exempts first home buyers to $700,000, a $15,000 grant, and about $22,700 of cash needed at settlement.
$950,000 established home in Victoria, twenty per cent deposit, no guarantee
Above the Victorian concession ceiling, so the full $52,070 of duty applies and about $244,770 of cash is needed at settlement.
When people use it
- Setting a savings target that includes duty and legal costs, not just the deposit
- Deciding whether to buy now under the First Home Guarantee or save to twenty per cent
- Testing whether a purchase price sits above or below your state's duty threshold
- Comparing what the same budget buys across two states before an interstate move
- Checking whether a new build with a grant beats an established home at the same price
Tips
- The First Home Guarantee removes mortgage insurance on a five per cent deposit, but property price caps apply by state and region, so confirm the cap for your area with Housing Australia before you bid.
- First Home Super Saver lets you release voluntary super contributions plus deemed earnings towards a deposit. Request the determination from the Australian Taxation Office before you sign a contract, because the timing rules are strict.
- Mortgage insurance is usually capitalised onto the loan rather than paid up front, which means you pay interest on it for the life of the loan. A sixteen thousand dollar premium at six per cent costs far more than sixteen thousand dollars.
- Ask your lender for the exact policy on family guarantees. A parent offering equity in their own home can remove mortgage insurance entirely without the guarantee scheme.
- Budget for the costs this page does not price: council and water adjustments at settlement, loan application fees, removalists, and connecting utilities. Two to three thousand dollars covers most purchases.
- Get the building and pest inspection before the cooling off period ends, not after. In several states the cooling off window is only a few business days.
What it assumes, and where it stops being accurate
- Duty is calculated from the published state scale and a linear phase out between the exempt and concession thresholds. Each revenue office has its own exact formula and is the authority on your purchase.
- Grant amounts are indicative, apply to new builds only, and carry value caps that are not modelled here.
- Mortgage insurance uses an indicative premium grid. Insurers price on loan size, LVR, employment type and property type, so a quote can differ by thousands.
- Borrowing capacity is a flat five times gross income. Real serviceability assessments deduct living expenses, other debts and credit card limits, and test the loan about three percentage points above the actual rate.
- Foreign purchaser duty surcharges, vacant land concessions, and off the plan duty deferrals are excluded.
- Ongoing costs after settlement, including council rates, insurance, strata levies and maintenance, are not included in the cash figure.
Terms used on this page
- Loan to value ratio (LVR)
- The loan expressed as a percentage of the property value. Mortgage insurance is charged above eighty per cent.
- Lenders mortgage insurance (LMI)
- A one off premium protecting the lender against default when the deposit is under twenty per cent.
- First Home Guarantee
- A Commonwealth scheme that guarantees part of the loan so eligible buyers can purchase with a five per cent deposit and no mortgage insurance.
- Transfer duty
- State tax on a property transfer, also called stamp duty, payable in cash at or shortly after settlement.
- First Home Super Saver
- A scheme that lets you release voluntary superannuation contributions and deemed earnings to help fund a first home deposit.
Questions people ask
- How much deposit do I actually need for a first home?
- Twenty per cent of the price avoids lenders mortgage insurance entirely, but very few first buyers reach it. Five per cent is enough under the First Home Guarantee, and most lenders will lend at ten per cent with insurance added. Whatever the deposit, you also need cash for duty, conveyancing, searches and inspections, which this calculator adds for you.
- Is stamp duty waived for first home buyers?
- In most states there is a full exemption below one threshold and a sliding concession up to a higher one. New South Wales exempts eligible first home buyers to $800,000, Victoria to $600,000, Queensland to $700,000 and Western Australia to $500,000. South Australia exempts new homes at any price, while the Australian Capital Territory tests household income instead of price.
- Can I get the First Home Owner Grant on an existing house?
- No. Every state and territory restricts the grant to newly built homes, off the plan purchases or substantially renovated properties, and each applies a value cap. Established homes attract no grant anywhere in Australia, although they still qualify for duty concessions in most jurisdictions, which are usually worth more than the grant.
- What is lenders mortgage insurance and who does it protect?
- It is a one off premium charged when your deposit is under twenty per cent, and it protects the lender if you default and the sale does not cover the debt. It gives you nothing. It is normally added to the loan rather than paid in cash, so you also pay interest on it, which is why avoiding it through the guarantee or a larger deposit is worth real money.
- Does the First Home Guarantee cost anything?
- There is no fee for the guarantee itself and no insurance premium, which is the whole point of it. You still pay the normal interest rate, application fees and duty. The scheme has property price caps that vary by state and by capital city versus regional area, and you must move into the property and live in it.
- Why is my borrowing capacity lower than five times income?
- Lenders subtract your living expenses using a household expenditure benchmark, deduct other loan repayments and the full limit of every credit card you hold, then test the loan at roughly three percentage points above the advertised rate. Dependants, HELP repayments and casual income all reduce the assessment further, so treat the figure here as a ceiling.
Use this with
First Home Buyer Calculator answers one part of the question. These pick up where it stops: Stamp Duty Calculator, Home Affordability Calculator, Mortgage Calculator, Rent vs. Buy Calculator and Superannuation Calculator.
Where these figures come from
Figures and rules on this page follow Australian law and ATO guidance.
- Housing Australia: Home Guarantee Scheme. First Home Guarantee eligibility and property price caps
- Moneysmart (ASIC). Independent government guidance on borrowing, insurance, tax and investing
- Revenue NSW: calculate transfer duty
- State Revenue Office Victoria: land transfer duty
- Queensland Revenue Office: transfer duty rates
First Home Buyer Calculator produces an estimate for general information. It is not financial, tax, medical, legal or engineering advice. read the full disclaimer. Spotted a wrong number? Report it and it gets fixed. The form picks up this calculator and the inputs you used.