How much deposit do you really need to buy in Melbourne?
The biggest myth in home buying is that you need a 20% deposit. While 20% lets you avoid Lenders Mortgage Insurance (LMI), most first home buyers in Melbourne get in with a lot less. Here is what your real options look like in 2026.
The 5% deposit path: First Home Guarantee
Under the federal First Home Guarantee, eligible first home buyers can purchase with as little as a 5% deposit and pay no LMI — the government guarantees the rest. Places are limited and income and price caps apply, so it pays to check your eligibility early.
The 2% deposit path: Help to Buy
The Help to Buy shared-equity scheme lets eligible buyers purchase with a 2% deposit, with the government taking an equity share in the property. It reduces your loan size and repayments, but you share future capital growth.
Going it alone: deposit + LMI
If you do not qualify for a scheme, you can still buy with a 5–10% deposit and pay LMI — a one-off cost that lets you buy sooner rather than waiting years to save 20%. For many buyers, getting into the market earlier outweighs the LMI cost.
The no-deposit-needed option: family guarantor
A guarantor loan uses a portion of a family member's home equity as additional security, which can let you borrow up to 100% of the purchase price and avoid LMI — without your parents handing over cash.
The right path depends on your income, the price you are targeting and whether you qualify for a scheme. A quick chat is usually all it takes to map it out.
Costs beyond the deposit
Remember to budget for stamp duty (first home buyers may get concessions), conveyancing, building and pest inspections, and moving costs. Use our buying costs calculator to estimate the full picture.
Next step
Not sure which path fits? Message Brokio on WhatsApp and we will check your eligibility across schemes and 40+ lenders — free, with no obligation.