Smart ways to plan your first home purchase

What pre-purchase planning actually involves

Pre-purchase planning is the work you do before you start looking at homes. You figure out how much you can borrow, what deposit you need, and which loan structures suit your situation. A buyer who starts this process early usually has a clearer sense of what they can afford and which properties are realistic options.

For buyers looking in Scarborough, that clarity matters. The suburb sits between the Redcliffe Peninsula and the Brisbane CBD, with a mix of beachside units, older cottages and newer townhouses. Property types vary, and so do the borrowing strategies that suit them. A couple buying a two-bedroom unit near Scarborough Beach Park will have different needs to a family buying a house with a backyard in the streets near Humpybong State School.

Consider a buyer who wants to purchase in Scarborough with a 10% deposit. They need to know upfront whether Lenders Mortgage Insurance will apply, what that adds to their upfront costs, and whether they qualify for the Australian Government 5% Deposit Scheme. They also need to check whether Queensland's stamp duty concessions reduce what they pay at settlement. Those answers shape what they can afford and when they're ready to buy.

How much deposit you actually need

You can purchase with a 5% deposit under the Australian Government 5% Deposit Scheme if you meet the eligibility criteria. The scheme has no income caps and no annual place limits, but you must apply through a participating lender. You cannot go directly to Housing Australia. The lender guarantees the gap between your deposit and 20% of the property value, so you avoid paying Lenders Mortgage Insurance.

In Scarborough, the property price cap is $1,000,000 because the suburb is classified as a regional centre under the scheme's postcode tool. Most units and a number of houses fall within that cap. Both the purchase price and the lender's assessed value must sit at or below $1,000,000 for the scheme to apply.

If you're buying outside the scheme, a 10% or 20% deposit is more common. A 10% deposit usually triggers LMI. A 20% deposit avoids it. LMI is a one-off premium that protects the lender if you default. It can add several thousand dollars to your upfront costs, and it's capitalised into the loan or paid at settlement depending on your lender.

Your deposit also needs to include genuine savings. Most lenders want to see at least 5% of the purchase price held in your own accounts for at least three months. Savings accumulated through regular contributions count. A cash gift from a parent can form part of your deposit, but it usually doesn't count toward the genuine savings requirement unless specific lender criteria are met.

Working out your borrowing capacity before you search

Your borrowing capacity is the maximum amount a lender will let you borrow. It's based on your income, your living expenses, and any debts you already have. Lenders apply a buffer to the interest rate when they assess your application, so they test whether you could still afford repayments if rates rise.

A buyer earning $85,000 a year with no other debts and modest living expenses might be able to borrow around six to seven times their income, depending on the lender and the current serviceability rules. A buyer with a car loan, a personal loan, or an existing credit card limit will have a lower capacity because those commitments reduce what's available for a home loan.

You can use a borrowing capacity calculator to get a rough figure, but that's only a starting point. Lenders assess applications individually, and small changes to your income or expenses can shift the outcome. If you're planning to buy in Scarborough and you want to know what you can afford, it makes sense to get a full assessment done before you start attending open homes.

Stamp duty concessions and grants in Queensland

Queensland offers a $30,000 First Home Owner Grant for new homes valued under $750,000. The grant applies to contracts signed for newly built homes, and it has been extended for four years from 1 July 2026. It does not apply to established homes.

For buyers purchasing an established home, Queensland provides a first home concession on stamp duty. The concession reduces transfer duty by up to $17,350 on properties valued up to $709,999. The concession reduces in $10,000 property value bands and reaches nil for properties valued at $800,000 or more. Duty is not eliminated entirely under this concession, but the reduction can make a noticeable difference to what you pay at settlement.

If you're buying a new home or vacant land, a full transfer duty concession applies with no price cap for contracts signed on or after 1 May 2025. Duty is reduced to nil on the residential land component. For agreements entered into on or after 1 August 2026, at least one applicant must be an Australian citizen, permanent resident or specified foreign retiree.

These concessions can be used alongside the Australian Government 5% Deposit Scheme. You cannot combine the scheme with Help to Buy, but most state grants and duty concessions remain available.

Fixed, variable or split loan structures

A fixed interest rate locks in your repayments for a set period, usually between one and five years. You know exactly what you'll pay each month, and you're protected if rates rise during that period. The downside is that you're usually limited in how much extra you can repay without triggering break costs, and you may not have access to an offset account depending on your lender.

A variable interest rate moves with the market. If rates fall, your repayments fall. If rates rise, your repayments rise. You usually have more flexibility to make extra repayments, and you can often link an offset account to reduce the interest you pay. An offset account is a transaction account linked to your home loan. The balance in the account offsets the loan balance when interest is calculated, so you pay less interest without losing access to your funds.

A split loan gives you both. You fix part of your loan and keep the rest variable. You get some certainty on repayments and some flexibility to pay extra or use an offset. It's a common choice for first home buyers who want to manage risk without locking themselves in completely.

If you're buying in Scarborough and you plan to rent out a room to help cover your repayments, a variable loan with an offset account might suit you. If you want stable repayments while you settle into homeownership, a fixed rate or a split might make more sense. The right structure depends on your income, your savings habits, and how much flexibility you need.

Getting pre-approval and timing your application

Pre-approval is conditional approval from a lender before you find a property. It tells you how much you can borrow and gives you confidence when you're making an offer. Pre-approval usually lasts between three and six months, depending on the lender.

You'll need to provide proof of income, bank statements, identification, and details of any debts or liabilities. The lender will assess your application and issue a letter confirming the approved amount. That letter doesn't guarantee final approval, because the lender still needs to assess the property you're buying, but it gives you a solid indication of where you stand.

If you're planning to buy in Scarborough within the next few months, getting pre-approval now means you can move quickly when you find the right property. The suburb's proximity to the water and the train line makes it popular with buyers looking for lifestyle and commuter access, so properties that tick both boxes tend to move.

You can start your first home buyer application by getting your documents together and working out which loan features matter most to you. If you're not sure where to start, a conversation with a broker can clarify what's realistic and what needs to change before you apply.

Using the First Home Super Saver Scheme to build your deposit

The First Home Super Saver Scheme lets you make voluntary contributions into your super fund and then release eligible amounts to use as a deposit. You can release up to $15,000 from any one financial year, with a total cap of $50,000. Concessional contributions are taxed at 15% rather than at your marginal income tax rate, so you keep more of what you save.

You need to obtain a determination from the ATO before you sign a purchase contract. The determination confirms how much you can release and when. The process takes time, so it's worth starting early if you're planning to use the scheme.

A buyer in Scarborough who has been making regular super contributions for two years might be able to release $30,000 toward their deposit. That amount could be the difference between needing LMI and avoiding it, or between qualifying for the 5% Deposit Scheme and needing a larger deposit. The scheme works well if you're still building your deposit and you have time to plan ahead.

Call one of our team or book an appointment at a time that works for you. We'll walk through your income, your savings, and your timeline, and we'll help you figure out which deposit options, loan structures, and concessions apply to your situation. If you're buying in Scarborough, we know the local market and we'll make sure your plan fits the property type and the lifestyle you're after.

Frequently Asked Questions