Buying your first home is exciting, and also confusing — there's a lot of terminology thrown around before anyone explains what it actually means for you. This guide walks through the practical order of operations: what to sort out first, what grants and concessions might apply, and the situations that catch first-time buyers off guard most often.
Start with your borrowing power, not the property search
It's tempting to start scrolling listings first. But without knowing what you can actually borrow, you risk falling in love with something out of reach — or underestimating what's possible and ruling out areas you could afford. A quick borrowing power estimate takes a few minutes and gives you a realistic range to search within.
Understand what a lender actually looks at
Lenders assess your ability to repay a loan, not just whether you can afford it today. That means they look at:
- Income — including how stable and how it's structured. Multiple employers, casual work, or income from overseas can all be assessed differently by different lenders.
- Living expenses — your declared spending, tested against a standard benchmark.
- Existing debts — including credit card limits, which are assessed on the limit, not your balance.
- The assessment rate — lenders test your ability to repay at a rate roughly 3% higher than today's actual rate, to make sure you'd cope if rates rise.
If you're supporting an application with income from multiple sources, family members overseas, or a family gift toward your deposit, this is exactly the kind of situation where the right lender choice matters more than the headline interest rate. Not every lender treats these situations the same way.
Grants and concessions worth knowing about
Depending on your state and the property you're buying, you may be eligible for:
- First Home Owner Grant (FHOG) — a one-off payment for eligible new or substantially renovated homes, with thresholds and amounts varying by state.
- Stamp duty exemptions or concessions — many states waive or reduce stamp duty for first home buyers under certain price thresholds. Our stamp duty calculator gives you an indicative figure by state.
- Low-deposit schemes — government-backed guarantee schemes can let eligible buyers purchase with a smaller deposit without paying Lenders Mortgage Insurance (LMI).
These change periodically and eligibility rules are specific, so it's worth confirming your exact entitlement with a broker before you budget around them.
Situations that trip up first-time buyers
Underestimating upfront costs
Stamp duty, conveyancing, building and pest inspections, and loan establishment fees all add up before you've paid a cent of your deposit toward the property itself. Budget for these separately from your deposit.
Credit card limits, not balances
A $15,000 credit limit you barely use is still assessed by lenders as a real ongoing commitment. If you're planning to apply for a home loan, reducing unused credit limits beforehand can genuinely increase your borrowing power.
Applying with the wrong lender for your situation
Every lender has slightly different policies around things like visa status, overseas income, family gifts, or casual employment. The lender that's right for your friend isn't necessarily right for you — this is the main reason to compare across a panel rather than walking into a single bank.
What to do next
A good starting point is a free, no-obligation conversation before you've made any decisions. We'll talk through your situation, give you a realistic borrowing range, and flag anything in your circumstances that's worth planning around early.
Book a free consultation