If I Were Buying a House in Australia in 2026, I’d Do This First

Summary

Buying a home in Australia can feel overwhelming, but following these seven simple steps can make the process easier. Start by getting your finances in order and understanding your budget, then explore government schemes like the First Homeowner Grant and the 5% deposit guarantee. Speak to a mortgage broker early to guide you through the loan process, and get pre-approval before you start house hunting. Set realistic search criteria based on your lifestyle and financial goals, and once you find your dream home, make an offer and handle the loan documents. Finally, complete the settlement and move into your new home with confidence.

Takeaways

• 😀 Get your finances ready: Understand your deposit amount, ongoing costs, and set a realistic budget before house hunting.
• 😀 Government schemes can help: Explore programs like the First Homeowner Grant, the First Home Guarantee, and the Help to Buy scheme to lower your upfront costs.
• 😀 Speak to a mortgage broker early: A good broker can help you understand your borrowing power, compare loan options, and navigate government schemes.
• 😀 Get pre-approval: Secure pre-approval from a lender to know your budget, make your offer more attractive, and avoid unpleasant surprises later.
• 😀 Set realistic search criteria: Focus on must-haves and nice-to-haves, prioritize lifestyle, and stay grounded in your budget when looking for properties.
• 😀 Make an offer and get loan documents sorted: After finding the right property, make an offer with conditions, finalize your loan, and ensure everything is on track.
• 😀 Settlement day is the final step: After contracts are signed, the settlement process transfers ownership and allows you to pick up the keys to your new home.
• 😀 Mortgage repayments build equity: Every repayment made slowly builds equity in your property, instead of paying rent or someone else's mortgage.
• 😀 Don’t stretch your budget to the max: Instead of borrowing the maximum a bank approves, choose a repayment amount you can comfortably afford while maintaining your quality of life.
• 😀 Factor in all costs of homeownership: Consider council rates, water bills, insurance, maintenance, and more, in addition to the mortgage repayment.
• 😀 Take advantage of available resources: Use government grants, mortgage brokers, and pre-approvals to streamline your home-buying journey and avoid common pitfalls.

Q & A

What is the first step when buying a home in Australia?

The first step is to get your finances in order. This involves assessing how much deposit you can realistically save, understanding all the ongoing costs of homeownership, and creating a budget around what you can comfortably afford to repay each month.

Why is it important to avoid the maximum amount a bank will lend you?

It's crucial to avoid relying on the maximum loan amount the bank offers because it might lead to financial strain. Instead, you should focus on what you can realistically afford to repay without sacrificing your lifestyle, savings, or peace of mind.

What is the First Home Owner Grant (FHOG)?

The First Home Owner Grant is a cash grant provided by the state government to assist first-time homebuyers. It typically applies to new or newly built homes, with the grant amount varying by state (usually around $10,000 or more). It helps to cover part of the upfront costs like stamp duty.

How does the First Home Guarantee (5% deposit scheme) help buyers?

The First Home Guarantee allows first-time buyers to purchase a home with just a 5% deposit, without having to pay lender's mortgage insurance (LMI). The government guarantees the remaining 15%, saving buyers tens of thousands of dollars in LMI costs.

What is the Help to Buy Scheme, and how does it work?

The Help to Buy Scheme, also known as the shared equity scheme, allows the government to co-own a portion of the property with you. This reduces the deposit needed (as little as 2%), and the government contributes up to 40% for a new home. The buyer repays only the loan portion they borrowed.

Why is speaking to a mortgage broker important when buying a home?

Speaking to a mortgage broker is important because they can help you understand your borrowing power, navigate loan types, and find the best deal across multiple lenders. Brokers compare a wide range of home loan options, saving you time and potentially money.

What is the benefit of getting pre-approval before house hunting?

Getting pre-approval helps you understand how much you can borrow, which narrows your property search and prevents emotional decisions based on properties you can't afford. It also strengthens your position as a serious buyer, especially in competitive markets.

What is a realistic way to set your search criteria for a property?

To set realistic search criteria, you should list non-negotiables (must-haves) and nice-to-haves (things you can compromise on). Consider factors like location, lifestyle, and future growth potential. Stay grounded by sticking to your budget and pre-approval amount.

What steps are involved after making an offer on a property?

After making an offer, you’ll need to confirm your loan application with your lender or broker, provide any required documents for final approval, and undergo property valuation. This process often involves conditions like building and pest inspections.

What is the role of a conveyancer during the settlement process?

A conveyancer is a legal professional who manages the legal side of the property purchase. They ensure all paperwork is in order, check the property's title, and handle the ownership transfer during settlement. Their services typically cost around $1,000 to $2,000, depending on the complexity of the transaction.