Home Financing Costs in Australia: What to Budget For
Buying a home in Australia involves more than the loan repayment itself — stamp duty, the deposit, and Lenders Mortgage Insurance all need to be budgeted for before you commit.
Stamp Duty Is Set by Your State or Territory
Unlike a federal tax, stamp duty (transfer duty) is set individually by each state and territory (NSW, VIC, QLD, WA, SA, TAS, ACT, NT), so there's no single national rate — each jurisdiction has its own thresholds, rates, and concessions or exemptions for eligible first-home buyers. Use your state revenue office's calculator (such as Revenue NSW or the State Revenue Office Victoria) to confirm the exact amount for your purchase — see the Home Financing Calculator on this site for an estimate using an effective rate.
The Deposit and Lenders Mortgage Insurance (LMI)
Most lenders prefer a deposit of at least 20% of the property value. Below that, most lenders require Lenders Mortgage Insurance (LMI) — a one-off premium that protects the lender, not you, if you default, but is paid by you and can add thousands of dollars to the cost of the purchase. The First Home Guarantee lets some eligible first-home buyers purchase with as little as a 5% deposit without paying LMI, through a limited number of places allocated each financial year — check current eligibility and availability on Housing Australia's website.
Ongoing Costs Beyond the Loan
Budget for building and contents insurance, council rates, strata fees (for apartments and townhouses), and maintenance — these ongoing costs can add hundreds of dollars a month on top of the loan repayment itself.
Frequently Asked Questions
- How much is stamp duty on a home in Australia?
- It depends entirely on your state or territory — there's no single national rate. Each jurisdiction (NSW, VIC, QLD, WA, SA, TAS, ACT, NT) sets its own rates, thresholds, and first-home-buyer concessions. Use your state revenue office's calculator to confirm your exact amount.
- What deposit do I need to buy a home in Australia?
- Most lenders prefer at least 20% of the property value. Below that, most lenders require Lenders Mortgage Insurance (LMI), though the First Home Guarantee lets some eligible first-home buyers purchase with as little as 5% deposit without paying LMI.
- What is Lenders Mortgage Insurance (LMI)?
- A one-off insurance premium many lenders require when your deposit is below 20% of the property value. It protects the lender, not you, if you default on the loan, but the cost is passed on to you.
- What ongoing costs come with owning a home beyond the loan repayment?
- Building and contents insurance, council rates, strata fees for apartments and townhouses, and maintenance, which can add significantly to the monthly cost.
Informational content, not financial, tax, or legal advice. Verify amounts, limits, and current conditions directly with official sources (ATO, ASIC, APRA) before making a decision.
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