I can’t tell you how many times we hear ‘really, so I don’t need a 20% deposit?’ in a meeting. The common myth of requiring a 20% deposit to buy a home has not been the case since Lender Mortgage Insurance or LMI was introduced in Australian in 1965. LMI was introduced to bridge the gap of homeownership for first time buyers.

Generally, the bank rewards customers with 20% deposits with lower interest rates and doesn’t charge a one off LMI premium. Saving a 20% deposit these days could be quite a challenge for many, especially when the medium house price is climbing to $1,000,000, that’s $200,000 in savings you need plus additional costs like stamp duty.

So, how much do you really need? There are options to enter the market with no deposit or as minimum as 5% of the property purchase price.

As property prices continue to increase, your 5% deposit goal can be an ever moving target, but once you purchase your first property, you will then take advantage of prices growths in your property.

If you have a guarantor, you won’t any savings at all. Here is a blog with everything you need to know about guarantor loans.