Australian Property Podcast Low Deposit, High Stakes: Inside Australia's 5% Revolution
Dec 16, 2025
Discover the ins and outs of Australia's new 5% deposit scheme for first homebuyers. The hosts delve into eligibility criteria and the benefits of avoiding lender's mortgage insurance. They highlight the impact on property prices and discuss budgeting for hidden costs. Key strategies for parental support and the importance of securing pre-approval are covered. The risks and drawbacks, including cash flow concerns, are also examined, alongside the need for a solid emergency fund. Get ready to make informed decisions on your property journey!
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Policy Changes Can Shift Market Competition
- Expanding eligibility and raising price caps vastly increases potential take-up of the scheme.
- That can shift competition and push prices higher in the lower quartile of markets.
How The 5% Guarantee Works
- The 5% Home Guarantee lets first-time buyers avoid LMI by government guaranteeing up to 15% of the loan to lenders.
- This can save tens of thousands and makes entry achievable sooner for many buyers.
Student With $100k Still Struggled
- Pete described a university student with $100k saved who still faced borrowing constraints despite a large deposit.
- The example shows borrowing capacity often limits purchase more than deposit size.