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First-Home Buyer Upfront Costs 2026: Stamp Duty, FHOG, Deposit & How the Total Shapes Your Maximum Loan

Complete breakdown of first-home buyer upfront costs in Australia for 2026. Covers stamp duty, the First Home Owner Grant by state, the minimum deposit, LMI, conveyancing, and how the all-in upfront bill impacts your LVR and borrowing capacity under APRA's serviceability buffer.

The upfront cost of buying your first home in Australia is not just the deposit. It is the deposit plus stamp duty, plus conveyancing and government fees, plus Lenders Mortgage Insurance if your LVR exceeds 80%, minus any First Home Owner Grant you receive at settlement. For a first-home buyer purchasing at $650,000 in Sydney, the all-in upfront cash needed ranges from approximately $112,000 — if you qualify for the NSW full stamp duty exemption and avoid LMI — to over $170,000 if you face general duty and an LMI premium. The gap between these two numbers is roughly one year of after-tax income for a single earner on the median Australian salary. This article lays out every cost component, shows how the FHOG and stamp duty concessions interact across all eight states, and explains how your total upfront bill determines your LVR — which in turn determines your interest rate, whether you pay LMI, and how much you can ultimately borrow under APRA’s 3% serviceability buffer.

The Five Components of Upfront Cost

When a lender or conveyancer prepares a settlement statement, the upfront cost of a purchase has five main components. Understanding each one matters because lenders assess your application on the net deposit — the cash you have left after non-deposit costs are paid.

The first component is the deposit itself. This is the gap between the purchase price and the loan amount. Most Australian lenders require at least a 5% deposit plus LMI for owner-occupied purchases, but the sharpest rates and zero LMI are reserved for deposits of 20% or more. A deposit of 20% on a $650,000 property is $130,000. At 10%, it is $65,000, but LMI of $8,000 to $15,000 is added and may be capitalised into the loan.

The second component is stamp duty. As detailed in our state-by-state guides, this cost varies dramatically — from zero for a qualifying first-home buyer in most states up to approximately $33,525 (Queensland general rate at $650,000) or $31,070 (Victoria). For a detailed breakdown of your state’s rules, read our guides on NSW stamp duty for 2026 and Queensland stamp duty for 2026, or see the full eight-state stamp duty comparison for 2026.

The third component is the First Home Owner Grant. The FHOG is a cash payment from the state government, usually paid at settlement or at the first drawdown of a construction loan. The amount and conditions differ by state — from $10,000 in NSW and Victoria to $30,000 in Queensland. The grant adds to your deposit, reducing the cash you must save from your own resources.

The fourth component is conveyancing and government fees. A solicitor or licensed conveyancer typically charges $1,200 to $2,500 for a standard residential purchase. Government registration fees — for the transfer of title and the mortgage — add another $300 to $500. Building and pest inspections cost $400 to $800. These are fixed or semi-fixed costs that do not scale much with property price, but they consume your cash buffer on settlement day.

The fifth component is Lenders Mortgage Insurance. If your LVR exceeds 80%, the lender requires LMI to protect itself against default. The premium is typically capitalised into the loan, meaning you do not pay it upfront in cash, but it increases your total debt and your monthly repayment. On a $520,000 loan at 85% LVR, a one-off LMI premium of approximately $8,000 capitalised adds roughly $40 per month to repayments at current rates. Under the APRA buffer, that extra $40 per month also shrinks your assessed borrowing capacity by approximately $5,000 because the buffer tests your surplus against the repayment including that additional cost.

Worked Example: $650,000 First Home in Sydney

To make the components concrete, consider a first-home buyer purchasing an established apartment in Western Sydney at $650,000. They have saved $80,000 from their own resources.

Under the NSW First Home Buyers Assistance Scheme, properties at $650,000 are fully exempt from transfer duty. The buyer pays zero stamp duty. The FHOG does not apply — the $10,000 grant is reserved for new homes, and this is an existing apartment.

The buyer’s conveyancer quotes $1,800 including disbursements. Registration fees add $400. Building and pest inspection is $500. Total fees: $2,700.

The buyer’s $80,000 savings, less $2,700 in fees, leaves a net deposit of $77,300. On a $650,000 purchase, the loan required is $572,700, producing an LVR of 88.1%. Because the LVR exceeds 80%, LMI applies. The premium is approximately $12,000, capitalised into the loan, bringing the total loan to $584,700 and the effective LVR to just under 90%.

At a variable rate of 6.34% and an LVR loading of 15 basis points, the product rate is 6.49%. The APRA assessment rate is 9.49%. At that assessment rate, the monthly repayment on $584,700 over 30 years is approximately $4,912. After accounting for tax, the Medicare Levy, and living expenses, the buyer’s monthly surplus must be at least $4,912 to qualify. For a single earner on $100,000, after-tax monthly income is roughly $6,400, and HEM living expenses for a single are approximately $2,100. The surplus of $4,300 falls short of the $4,912 assessment repayment. The application is rejected at this loan size.

If the same buyer had saved $130,000 instead — a 20% deposit — the loan is $520,000 at 80% LVR with no LMI. The assessment rate is 9.34% (6.34% product rate plus 3% buffer with no LVR loading). The repayment is approximately $4,320 per month. The surplus of $4,300 is just at the line — marginal but potentially approvable with a strong savings history and no other debts. The $50,000 difference in deposit — roughly two years of additional saving on a $100,000 income — is the difference between qualifying and being declined.

This is why first-home concessions matter so much. If the buyer had purchased a new apartment at the same price in Queensland instead, they would receive zero duty, a $30,000 FHOG, and would need only $100,000 in savings plus the grant to reach 20% deposit — a scenario that makes an 80% LVR achievable with substantially less personal savings.

First Home Owner Grant by State in 2026

The FHOG is a state-administered payment that supplements the deposit. The amounts and conditions for 2026:

New South Wales pays $10,000 for new homes valued at $600,000 or below. The cap is low by Sydney standards, limiting the grant to entry-level apartments and house-and-land packages in outer suburbs and regional centres.

Victoria pays $10,000 for new homes valued at $750,000 or below. The wider cap means the grant reaches more of Melbourne’s middle-ring property market.

Queensland pays $30,000 for new homes valued below $750,000. This is the most valuable FHOG in the country and, combined with the unlimited new-home stamp duty exemption, creates the strongest first-home support package.

Western Australia pays $10,000 for new homes. The value cap and metropolitan boundary conditions apply, and the exact threshold should be confirmed with the WA Department of Treasury at the time of purchase.

South Australia pays up to $15,000 for new homes. The maximum amount and specific conditions are administered by RevenueSA and may vary by property type and location.

Tasmania pays $10,000 for new homes. The grant applies to new construction and off-the-plan purchases, but the established-home stamp duty relief that formerly supplemented it expired on 30 June 2026.

The Australian Capital Territory abolished the FHOG in July 2019 and does not pay a grant. The territory relies on the broad HBCS stamp duty exemption — up to $1,020,000 with no income test from 1 July 2026 — as the sole first-home support mechanism.

The Northern Territory replaced the standard $10,000 FHOG with the HomeGrown Territory Grant of $50,000 for first-home buyers purchasing or building a new home with no price cap. A separate FreshStart grant of $30,000 is available for previous owners building or buying a new home. These are materially larger cash injections than any state-level FHOG.

For a first-home buyer purchasing a new home in the Northern Territory at $500,000, the HomeGrown grant supplies 10% of the purchase price as a cash deposit top-up — nearly enough on its own to reach a 20% deposit when combined with moderate personal savings. In Tasmania, the same buyer receives $10,000, leaving a larger savings requirement.

How the FHOG and Stamp Duty Interact

The FHOG and stamp duty concessions are separate government programs with independent eligibility rules. They can stack, and the combination is where the largest savings occur.

In Queensland, a first-home buyer purchasing a new apartment at $720,000 receives zero transfer duty under the unlimited new-home exemption and qualifies for the $30,000 FHOG because the value is below $750,000. The total benefit — duty savings of approximately $28,000 plus the $30,000 grant — is roughly $58,000. On a 20% deposit target of $144,000, the buyer only needs to save $86,000 from their own income. The effective contribution from government programs covers 40% of the deposit requirement.

In NSW, a first-home buyer at $720,000 receives zero duty under the FHBAS, but does not receive the FHOG because the value exceeds the $600,000 cap. The benefit is approximately $26,700 in duty savings only. The same buyer in Queensland receives an additional $30,000 on top.

In Victoria, a first-home buyer at $720,000 receives a partial stamp duty concession — not zero — because the full exemption cuts off at $600,000 and phases out to $750,000. The FHOG applies at $10,000. The net outcome is materially worse than in Queensland or NSW at this price point.

The lesson for a first-home buyer who can choose their state is clear: the combination of stamp duty exemption and FHOG access is the variable that most determines how much personal savings you need to reach an 80% LVR. Moving from a state with an uncapped exemption and a $30,000 grant to a state with a capped exemption and a $10,000 grant can mean the difference between qualifying with a 10% deposit and needing to save for two additional years.

Other Upfront Costs to Budget For

Beyond deposit, duty, and the FHOG, several smaller costs consume cash on settlement day and should be in your budget:

Conveyancing and legal fees typically range from $1,200 to $2,500 for a standard purchase. Disbursements — the searches and certificates your conveyancer orders from government agencies — add $200 to $400. A building inspection costs $400 to $600, and a pest inspection adds $200 to $300. A strata report for an apartment, which is essential but optional, costs $250 to $400.

If you are borrowing more than 80% of the property value, the LMI premium is capitalised into the loan but increases your total debt. On a $500,000 loan at 88% LVR, the premium is typically $10,000 to $14,000. You do not pay this in cash at settlement, but it adds to your monthly repayment and reduces assessed borrowing capacity.

Mortgage registration and title transfer fees, charged by the state land titles office, are approximately $150 to $250 each. Your conveyancer will include these in the settlement statement.

Council and water rates are adjusted at settlement so the buyer and seller each pay their respective portion of the year’s charges. The adjustment is usually a few hundred dollars and is settled between the solicitors from the purchase funds.

Home and contents insurance is not required at settlement but is strongly recommended from the date you take ownership. An annual policy for a standard first home costs $800 to $1,500 depending on the property and postcode. Lenders may require evidence of insurance before disbursing funds.

These smaller costs total roughly $3,000 to $5,000 for a typical first-home purchase in a capital city. They are not large relative to the deposit and duty, but they consume your cash buffer on the day, and failing to budget for them can create a settlement shortfall that delays your move.

Building Your Upfront Cost Budget

To calculate your total upfront cash requirement, work through these steps in order:

Start with the purchase price. Determine the minimum deposit your target lender requires — typically 5% for owner-occupiers, but 20% to avoid LMI.

Add the stamp duty applicable to your purchase. If you are a first-home buyer, check whether the full exemption, a partial concession, or the general rate applies. Your conveyancer or the state revenue office calculator can provide the exact dollar figure.

Subtract the FHOG if you qualify and the property meets the conditions. Confirm the timing — some states pay the grant at settlement, others at the first progress payment or completion of construction.

Add conveyancing ($1,500 to $2,500), government fees ($300 to $500), and inspections ($600 to $1,000). These are necessary costs with little room to negotiate.

Add a buffer of $1,000 to $2,000 for settlement adjustments, moving costs, and unexpected disbursements. It is better to arrive at settlement with cash left over than to scramble for a shortfall.

The result is the total cash you need in your account on settlement day. Divide that number by your monthly savings rate, and you have a realistic timeline to purchase.

If the total exceeds what you can save within a reasonable timeframe, consider levers you can pull: buy in a state with stronger first-home concessions, target a new home rather than an existing one to unlock the FHOG and potentially larger duty exemptions, or extend your savings timeline and rent for longer while accumulating a larger deposit. Each lever changes the LVR equation, and a small shift — from 88% LVR to 80% — changes the rate tier, the LMI premium, and your borrowing capacity under the buffer. For a worked example of how small income changes flow through to borrowing capacity, see our guide on the income tax cut and take-home pay in 2026.

Frequently Asked Questions

How much cash do I actually need on settlement day as a first-home buyer?

The total is purchase price minus loan amount, plus stamp duty (net of any concession), plus conveyancing and fees, minus the FHOG if paid at settlement. For a $650,000 property with a 10% deposit and a full stamp duty exemption in NSW, you need approximately $67,700 — $65,000 deposit plus $2,700 in fees, with no duty and no FHOG (the grant is for new homes only). For the same property at 20% deposit, you need approximately $132,700. The most accurate figure comes from your conveyancer’s settlement statement, which you should request before making an offer.

Can I use the FHOG as part of my deposit?

Yes. Most lenders treat the FHOG as genuine savings and count it toward your deposit, provided the grant is paid at or before settlement, which is the standard arrangement in most states. A $30,000 FHOG in Queensland reduces the personal savings requirement by the full $30,000. Some lenders apply additional conditions — for example, requiring that at least 5% of the purchase price comes from your own genuine savings — but the FHOG reduces the total you must accumulate. Confirm the specific treatment with your mortgage adviser, as lender policies differ.

Does LMI count as an upfront cost?

LMI is a cost you bear, but it is typically capitalised into the loan rather than paid upfront in cash. On a $500,000 loan at 88% LVR, an LMI premium of $12,000 is added to the loan balance, making the total debt $512,000, and your monthly repayment rises accordingly. You do not need to produce the $12,000 in cash at settlement, but the extra debt reduces your assessed borrowing capacity under APRA’s buffer. If you can reach an 80% LVR and avoid LMI entirely, you save both the premium and the serviceability constraint it creates.

What if I buy off-the-plan? Do the same costs apply?

Off-the-plan purchases change the timing of stamp duty. In most states, duty is assessed on the dutiable value at the earlier of completion or occupation, not at the date of the contract. This means you have a window — often 12 to 24 months — between signing the contract and paying duty. During that window, you can accumulate additional savings. In NSW, off-the-plan buyers may also qualify for a deferral of duty liability to settlement. Some states, including South Australia and Victoria, offer specific off-the-plan concessions that reduce the dutiable value by the construction costs incurred after the contract date. An off-the-plan purchase can reduce your upfront cash requirement at settlement compared with an established property at the same price, but the exact saving depends on the state, the contract date, and the construction progress. Confirm the specific off-the-plan duty treatment with your conveyancer.

Data Sources

All grant amounts, stamp duty rules, and cost estimates in this article are sourced from official Australian government publications as at July 2026:

How an Arrivau Adviser Can Help

The difference between qualifying for a home loan and being declined often comes down to how your upfront costs are structured. An Arrivau licensed mortgage adviser can calculate your exact duty and FHOG position, model your LVR under different deposit scenarios, and identify lenders who assess your application on the most favourable terms — including those who treat the FHOG as genuine savings and those who offer the lowest LMI premiums above 80% LVR. We respond within one business day.

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Disclaimer: This article is for general informational purposes only and does not constitute financial, tax, or legal advice. FHOG amounts, stamp duty concessions, and government fees are based on state and territory government publications as at July 2026 and are subject to legislative change. LMI premiums and lending criteria vary by lender and are not guaranteed. For personalised advice on your upfront costs, deposit position, and borrowing capacity, speak with an Arrivau licensed mortgage adviser.