Tips for young families buying their first home

Key takeaways:

• Dependants, childcare, parental leave and debts can affect borrowing capacity. Lender assessments vary.

• First home buyer support may reduce some buying costs. Eligibility, limits and conditions apply.

• Set property priorities before you search. Balance your family's needs against your budget.

• Budget beyond the deposit. Allow for upfront and ongoing home ownership costs.

• Pre-approval isn't final approval. Check your finance, property and contract before making an offer.

Buying your first home with children or other dependants means balancing what your family needs with what you can afford. Household income, dependants and expenses can affect your borrowing capacity, while factors such as bedrooms, schools, childcare and commute times can shape your property search.

Before you start looking, understand how costs such as childcare and HELP debt, as well as income changes during parental leave, may affect your finances. It's also worth checking which first home buyer assistance you may be eligible for and budgeting for the upfront and ongoing costs of home ownership.

This guide covers the key financial and property considerations to help young families set a practical budget and priorities for their first home.

Tip #1: Work out what you can afford as a family.

Your borrowing capacity is an estimate of how much you may be able to borrow. Lenders assess factors including your household income, living expenses, dependants, existing debts and other financial commitments, with lending criteria varying between lenders. For families, key factors can include

• Income and dependants: Lenders assess eligible household income alongside your expenses and number of dependants. Having two incomes doesn't necessarily mean lenders will assess both in full or in the same way.

• Childcare costs: Regular childcare costs generally form part of the living expenses considered when assessing your ability to repay a home loan.

• Parental leave: Lenders have different policies for assessing paid parental leave and return-to-work income. Depending on the lender's policy, you may need to provide evidence supporting your parental leave arrangements and expected return-to-work income.

• Part-time, casual and other income: Lenders may consider these income types, but requirements can vary based on factors such as how long you've earned the income, its consistency and the supporting evidence available.

• Credit cards and other debts: Credit card limits, personal loans, car finance and other financial commitments can reduce the amount you may be able to borrow.

Becky Madden, Mortgage Broker at Aussie Erina, says existing debts and lender policy differences are worth considering early when families are working out their borrowing position.

"Personal loans such as car loans and large credit card limits reduce borrowing power," she said.

"Stable income is an important consideration for lenders, however their policies range widely. For self-employed applicants and those who recently changed jobs, there are still lenders who would consider them."

You might also be interested in: Explained: Debt consolidation home loans

How does HELP debt affect your borrowing power?

Having a Higher Education Loan Program (HELP) debt doesn't automatically prevent you from getting a home loan. However, compulsory HELP repayments can reduce the income available to service a loan and may affect your borrowing capacity.

Under the current marginal HELP repayment system introduced from the 2025–26 income year, compulsory repayments are generally calculated on repayment income above the applicable minimum threshold. Thresholds are indexed, so check the ATO rates for the relevant financial year.

Understanding how these factors may affect your borrowing capacity can help you set a more realistic property budget before you start your search.

Use Aussie's Borrowing Power Calculator to estimate how much you may be able to borrow. Results are indicative only and don't represent loan approval. An Aussie Broker can also help you understand how different lenders may assess your family's income, expenses and commitments, subject to lender criteria.

You might also be interested in: HECS home loan changes: What it means for your borrowing power

Tip #2: Check first-home buyer grants and government schemes.

Eligible first home buyers may be able to access Australian Government schemes alongside state or territory grants, concessions and exemptions. Eligibility, property limits and other conditions vary, so check what applies before setting your deposit and purchase budget.

Australian Government 5% Deposit Scheme

Eligible first home buyers may be able to buy with a minimum 5% deposit without paying Lenders Mortgage Insurance (LMI), subject to scheme eligibility and lender approval. Housing Australia provides participating lenders with a government guarantee for part of the loan. Under the current settings:

• There are currently no income caps or limits on scheme places.

• Property price caps apply and vary by location.

• Eligibility requirements apply, including rules covering residency, previous property ownership and owner-occupation.

• Lender criteria and approval still apply. Eligibility for the scheme doesn't guarantee home loan approval.

Property price caps currently range from $400,000 in some locations to $1.5 million in Sydney and specified NSW regional centres. Check the government's current property price caps for where you plan to buy.

You might also be interested in: The Australian Government 5% Deposit Scheme: Buying with a 5% deposit

Single Parent Stream

Eligible single parents and single legal guardians of one or more dependent children may be able to buy with a minimum 2% deposit through the Single Parent Stream of the Australian Government 5% Deposit Scheme.

You don't necessarily need to be a first home buyer, but property ownership, owner-occupation, property price caps and other eligibility requirements apply.

What about regional first home buyers?

The former Regional First Home Buyer Guarantee closed to new applicants from 1 October 2025. Eligible regional buyers can instead use the Australian Government 5% Deposit Scheme or, where eligible, its Single Parent Stream. The property must still meet the applicable price cap and other scheme requirements.

You might also be interested in: 5% deposit vs Help to Buy vs Aussie Boost: Which option could help you buy sooner?

First Home Owner Grants and stamp duty concessions

State and territory governments may also offer eligible buyers a First Home Owner Grant, stamp duty concession or exemption, or other assistance. Rules vary and can depend on:

• Whether you buy or build a new or established home

• The property’s value

• Your previous property ownership

• Owner-occupation requirements

• When you sign your purchase or building contract.

For example, Queensland currently offers eligible first home buyers a $30,000 grant to buy or build a new home valued at less than $750,000, including land for eligible contracts signed on or after 20 November 2023. The Queensland Government extended the $30,000 grant for eligible contracts signed from 1 July 2026.

Check your state or territory revenue office for current grant amounts, property limits, eligibility requirements and deadlines before including any assistance in your budget.

You might also be interested in: What is the First Home Owner Grant?

Help to Buy

The Help to Buy Scheme is a separate shared-equity program. Eligible buyers contribute a minimum 2% deposit, while the Australian Government can contribute up to 30% of the purchase price of an existing home or 40% of a new home, taking an equivalent financial interest in the property.

Income thresholds, property price caps and other eligibility requirements apply. Help to Buy also has rules governing access to other government home-buying assistance, although some grants, stamp duty concessions and exemptions may still be available.

Help to Buy cannot be used with certain other Australian Government, state or territory home-buying schemes, including specified guarantees, loans and shared-equity assistance. Some grants, stamp duty concessions and exemptions may still be available, so check the rules for each program before including multiple forms of assistance in your plans.

You might also be interested in: Help to Buy Scheme: What first home buyers need to know

An Aussie Broker can help you understand the home loan options and federal home buyer schemes that may apply to your circumstances. For state and territory grants, concessions and exemptions, check the relevant government or revenue office for current requirements.

Tip #3: Decide what your family needs from a home.

Once you know your borrowing position, decide which property features matter most to your family. This can help you make clearer trade-offs between location, space and price later in your search. Consider:

• Bedrooms and layout: Think about the space you need for sleeping, living, working and storage, both now and as your family changes.

• Schools and childcare: Check school catchments and nearby childcare services rather than assuming a property has access to your preferred options.

• Commute and transport: Consider travel times to work, school and childcare, plus access to public transport where relevant.

• Shops and services: Check access to supermarkets, healthcare and other services your household regularly uses.

• Parks and open space: Nearby parks and playgrounds may matter more if the property has limited private outdoor space.

• Street and surrounding area: Consider traffic, pedestrian access, lighting and other features relevant to your household.

• Support network: Proximity to family or other support may influence which locations work for you.

Ranking features can also make it easier to decide what you're willing to compromise on. For example, you list may look like:

You may want to prioritise features that would be difficult or expensive to change later.

Also consider how your household size, working arrangements and space requirements could change and how long you expect the property to suit your family.

Tip #4: Choose a property type that fits your budget and needs.

Apartments, townhouses and houses offer different trade-offs in price, space, maintenance and ongoing costs. Compare options in your preferred locations and within your budget, rather than assuming one property type will suit your family best.

Property type alone doesn't determine affordability. Compare the purchase price and ongoing costs of individual properties, including strata or body corporate fees where applicable.

You might also be interested in: Choosing the right property for you: Unit or house?

Tip #5: Compare new builds and established homes.

Once you've chosen a property type, consider whether an established home or new build better suits your family's budget, timeframe and priorities. Each comes with different costs and practical considerations.

Neither option will suit every family. Compare the total cost, expected timeframe, location and property features against your budget and priorities before deciding which is the better fit for your first home.

You might also be interested in: Choosing the right property for you: Buy established or build from scratch?

Tip #6: Search for homes that meet your priorities.

Once you've set your criteria, use them consistently to shortlist and compare properties.

Shortlist before you inspect. Use online listings, floor plans and virtual inspections to rule out properties that don't meet your requirements before attending in person.

Use the same checklist at each inspection. Record the same information for each property so you can compare your options more easily:

• Property: Condition, layout, storage and potential repairs or improvements.

• Costs: Asking price or price guide, strata or body corporate fees where applicable, and other property-specific costs to investigate.

• Surroundings: Noise, traffic, access and other factors that may not be clear from the listing.

• Practical fit: Whether the property still meets your non-negotiables and other priorities after inspecting it.

If you're inspecting with children, plan around your household routine where practical and allow enough time to assess the property.

Keep notes on properties that remain suitable after inspection. This gives you a consistent basis for deciding which homes are worth investigating further.

Tip #7: Budget for the full cost of buying and owning a home.

Your deposit is only part of the cost of buying your first home. When setting your budget, include other upfront costs and ongoing property expenses. Depending on the property, home loan and any first home buyer assistance you're eligible for, upfront costs may include:

• Deposit: Your contribution towards the purchase price.

• Stamp duty: Costs vary by state or territory, property value and circumstances. Eligible first home buyers may qualify for a concession or exemption.

• Conveyancing or legal costs: These may include contract review, property searches and transferring ownership.

• Building and pest inspections: Where appropriate, allow for professional inspection costs before buying.

• Home loan costs: Application, valuation, settlement or other lender fees may apply.

• Lenders Mortgage Insurance (LMI): This may apply when borrowing a high proportion of the property's value, unless an exemption or eligible government scheme applies.

• Moving costs: Allow for removalists, utility connections and other moving expenses.

Madden says the deposit can sometimes overshadow the other costs families need to have available at settlement.

"People tend to budget for the 5–20% deposit and forget about the purchase costs," she said.

"We always factor in stamp duty (unless it's exempted), registration fees, lender setup fees and conveyancing fees in addition to the deposit, to ensure the client has enough funds to complete on settlement."

Government grants and concessions may reduce some upfront costs for eligible first home buyers. Eligibility and thresholds vary, so confirm what applies before including any assistance in your budget.

After settlement, ongoing property costs may include mortgage repayments, council rates, insurance, utilities, repairs and maintenance, and strata or body corporate fees where applicable. Add these costs to your existing household expenses to understand what buying and owning the property could cost overall.

You might also be interested in: The hidden costs of buying a bigger home in Australia

Tip #8: Don't treat your borrowing capacity as your target.

Compare repayments at different loan amounts, then test them against possible changes to your household finances, such as parental leave or reduced working hours, changing childcare or education costs, higher family expenses, temporary reductions in household income or higher repayments (including from interest rate changes on a variable-rate home loan).

There can also be a difference between the repayments you estimate and the interest rate a lender uses when assessing your ability to service a loan. APRA currently requires banks to assess new home loan borrowers using an interest rate at least 3 percentage points above the loan product rate.

Madden says this is something buyers may not account for when estimating their borrowing position themselves.

"People can also forget that lenders usually factor in a 3% buffer on top of their advertised rate when assessing whether the applicant/s would be able to repay the loan," she said.

"This means a 6% interest rate gets calculated at 9%, which many people don't factor in when estimating repayments using online calculators."

A higher purchase price may give you access to more space, a preferred location or additional features, but it can also commit more of your household income to repayments.

Weigh those benefits against the additional borrowing required. Comparing different loan amounts and repayment scenarios can help you set a purchase budget based on what you're comfortable taking on, rather than automatically using your maximum borrowing capacity.

You might also be interested in: Explained: Home loan repayments

Tip #9: Get pre-approval and do your due diligence before making an offer.

Before making an offer or bidding, confirm your financial position is up to date and complete the property and contract checks relevant to your purchase.

Consider home loan pre-approval. Conditional pre-approval can indicate how much a lender may be prepared to lend based on the information you've provided. Unlike a borrowing capacity estimate, it involves a lender assessment, but it still doesn't guarantee final approval. Keep in mind:

• Pre-approval is conditional: You still need final home loan approval.

• It can expire: Validity periods vary by lender, so check the expiry date if your property search takes longer than expected.

• Changes can affect your application: Changes to your financial circumstances may affect the lender's final assessment.

• The property matters: Final approval may depend on the lender's valuation and whether the property meets its lending requirements.

An Aussie Broker can help you understand the pre-approval process and prepare your home loan application, subject to lender criteria and approval.

You might also be interested in: 6 ways to make the most of home loan pre-approval

Check the property and contract. Once you've found a property you're considering, appropriate due diligence may include:

• Arranging building and pest inspections

• Having the contract reviewed by a conveyancer or solicitor

• Checking conditions attached to the sale

• Understanding whether a cooling-off period applies.

Property laws, contract requirements and cooling-off arrangements vary by state or territory and sale method. Different rules can apply when buying at auction, for example.

A conveyancer or solicitor can advise on the legal requirements of your purchase. Where possible, complete the appropriate checks before making an offer or bidding so you understand what you're agreeing to buy.

Ready to buy your first home as a family?

Buying your first home as a family involves more than finding a property within your price range. Start by understanding your borrowing position and how your household income, dependants and expenses may affect it.

Check which first home buyer schemes, grants and concessions you may be eligible for, then set realistic property priorities around your family's needs and budget. Account for the full cost of buying and owning the property, rather than treating your deposit or maximum borrowing capacity as your target.

When you're ready to make an offer, make sure your finance position is up to date and complete the appropriate property and contract checks. Conditional pre-approval can help you understand your potential finance position, but final approval remains subject to lender criteria and the property.

For Madden, getting advice early is less about being ready to apply immediately and more about having a clearer plan before the property search progresses.

"Online calculators and doing your own research is fine to a point, but not balancing that with realistic and tailored information can often lead to disappointment down the track," she said.

"A good broker is happy to help in the early stages of planning, as it will set families up better in the long run."An Aussie Broker can help you understand your borrowing position, compare home loan options and navigate the finance process.

FAQs about buying your first home as a young family