The $40,000 Question Most First Home Buyers Don't Know to Ask
There's a moment that happens in almost every first consultation with a first home buyer.
They sit across from me and say some version of: "I don't think we can afford it yet. We need to save more." Here's the thing about "save more"... more than what? For what milestone?
Most people don't actually know but they think they're just know they're "not there yet."
Sarah's Dilemma
Sarah came to me in September with $50,000 saved. She wanted to buy in Sydney, but she'd absorbed the conventional wisdom: you need 20% down, you need $200,000 saved, you're not ready yet.
Then October 1st happened. The Home Guarantee Scheme expanded. Suddenly, her $50,000 was enough - she could look at properties up to $1.5 million without paying $40,000 in Lenders Mortgage Insurance.
She was ready. Except for one problem.
When you make it easier for more buyers to enter the market with smaller deposits, prices rise. More buyers, more competition, same properties. Sarah could suddenly afford to buy - but what she could buy was getting more expensive by the month.
So what did we do?
I showed Sarah three scenarios:
- Buy now with 5% down - Get in before prices climb further, start building equity instead of paying rent, but carry more debt relative to the property value
- Wait 6 months, save harder - Build a bigger buffer, stronger position, but watch prices potentially rise faster than she can save
- Pivot to a different strategy - Consider different suburbs, different property types, different timelines
We stress-tested each one. What happens if rates move? If her income changes? If prices keep climbing vs. if they plateau?
Sarah bought. But not every client should. Last week I told someone to wait - they weren't financially ready regardless of what the scheme allowed.
The Real Problem
The issue isn't whether you have enough saved. The issue is you're making one of the biggest financial decisions of your life based on assumptions that might be three years out of date.
You think you need 20% down. Maybe you don't. You think you can't afford your target suburb. Maybe you can. You think you should wait. Maybe you shouldn't.
Or maybe you should - but for completely different reasons than you think.
Here's What I Actually Do
When you sit down with me, I'm going to show you what's actually possible under current rules - not what was possible when your parents bought, or what your mate at work thinks is right.
Then I'm going to tell you whether you should use it.
Sometimes the answer is "yes, buy now." Sometimes it's "wait six months and strengthen your position." Sometimes it's "you're financially ready, but this scheme isn't the right tool for you."
I'm not here to cheerlead you into a property you can't sustain. I'm here to translate policy into a plan that fits your actual situation.
What You Should Do This Week
If you've been saving and thinking "I'm not ready yet" - I want you to test that assumption.
Book a 15-minute eligibility check. Bring your numbers. I'll tell you:
- Whether you actually qualify for the expanded scheme
- What it would let you buy in your target areas
- Whether you should use it, wait, or consider a different approach
- What the actual trade-offs are for your situation
No obligation. No sales pitch. Just the facts about where you stand and what your options actually are.
Because the cost of not knowing? That's measured in years and tens of thousands of dollars.
Book your 15-minute eligibility check: 0437 460 035
— Loren
Loren specialises in first home buyer finance at Ledgersmith. She's helped hundreds of buyers navigate the Home Guarantee Scheme - including advising when not to use it.
