Your 2026 Guide to Buying Your First Home in New South Wales

Quick answer: Buying your first home in NSW in 2026 means working out your budget, checking eligibility for grants and schemes, getting loan pre-approval, finding the right home, exchanging contracts, and settling. Eligible first home buyers can access five state and federal supports, including the $10,000 First Home Owner Grant, transfer duty relief up to $1 million under the First Home Buyers Assistance Scheme, and the Australian Government 5% Deposit Scheme. Many buyers need a 5% to 20% deposit, while settlement timing depends on the home, contract and build stage. Completed homes may settle in around 4 to 6 weeks, while homes under construction or off the plan can take longer.

This guide walks through each step in detail: how much deposit you actually need, the grants and schemes available in 2026, what upfront and ongoing costs to budget for, the best Sydney suburbs to consider, and how to navigate the process from search to settlement.
 

Why choose Allam Property Group?

For 35 years, Allam has delivered move in ready homes across NSW, with fixed price contracts that remove guesswork from your planning. Our 4 Gold Star iCIRT rating, awarded by Equifax with NSW Government support, gives buyers independent confirmation of our financial stability and build quality.

Across South West Sydney (The Groves at Austral, Nakuru at Silverdale), the North West (The Collection at Box Hill, Redgum Rise at Oakville, McKenzie at Vineyard), and regional NSW (Sophia Waters at Chisholm, Ravenswood at Tullimbar), Allam offers new home options across a range of buyer budgets, with fixed price contracts that remove guesswork from your planning. Buying direct from the developer means fewer intermediaries and a clearer path to your new home.

How much deposit do first home buyers need in NSW?

In NSW in 2026, first home buyers typically need a deposit between 5% and 20% of the purchase price. Eligible buyers can purchase with a minimum 5% deposit through the Australian Government 5% Deposit Scheme without paying Lenders Mortgage Insurance. A 20% deposit usually avoids LMI without needing a scheme. Beyond the deposit, buyers should budget for transfer duty (if not exempt), legal fees, lender fees, inspections and moving costs.

• 5% deposit: possible for most eligible first home buyers through the Australian Government 5% Deposit Scheme. The scheme has no income caps, no waitlists, and removes the need to pay Lenders Mortgage Insurance, with NSW property price caps of $1.5 million for Sydney, Newcastle, Lake Macquarie and the Illawarra, and $800,000 for the rest of NSW. If you are not eligible for the scheme, LMI usually applies on deposits below 20%.
• 10% deposit: a common starting point for first home buyers, with LMI typically still payable.
• 20% deposit: generally avoids LMI and gives you more borrowing flexibility.

What grants and schemes are available to first home buyers in NSW in 2026?

Five main grants and schemes can help eligible first home buyers in NSW in 2026: the NSW First Home Owner Grant, the NSW First Home Buyers Assistance Scheme, the Australian Government 5% Deposit Scheme, the Help to Buy Scheme, and the First Home Super Saver Scheme. Some can be used together, but the 5% Deposit Scheme and Help to Buy cannot.

• First Home Owner Grant (FHOG): a $10,000 payment for eligible first home buyers building or buying a new home in NSW. The grant is not available for established homes. Price cap: $600,000 for a newly built home, or $750,000 for the combined land plus build contract on a house and land package. You must move in within 12 months and live there for at least 12 continuous months.
• First Home Buyers Assistance Scheme (FHBAS): transfer duty (stamp duty) relief for eligible first home buyers. New or existing homes: full exemption up to $800,000, concession from $800,001 to $1,000,000. Vacant land: full exemption up to $350,000, concession from $350,001 to $450,000. You must move in within 12 months and live there for at least 12 continuous months.
• Australian Government 5% Deposit Scheme: federal guarantee letting eligible first home buyers buy with a 5% deposit and no LMI. From 1 October 2025, the scheme has no income caps, no waitlists and unlimited places. NSW property caps: $1.5 million for Sydney, Newcastle, Lake Macquarie and the Illawarra, $800,000 for the rest of state. Apply through a participating lender.
• Help to Buy: a federal shared equity scheme launched 5 December 2025. Eligible buyers may purchase with a 2% deposit, with the Australian Government contributing up to 40% of the purchase price for newly built homes or 30% for existing homes. Income caps: $100,000 for individuals, $160,000 for couples and single parents. NSW caps: $1.3 million for Sydney and regional centres, $800,000 for the rest of state. 10,000 places per year. Currently available through Commonwealth Bank and Bank Australia. Cannot be combined with the 5% Deposit Scheme. The Government takes a proportional equity share, so it is not a grant.
• First Home Super Saver Scheme: lets eligible buyers save for a deposit through voluntary super contributions, with concessional tax treatment. You can contribute up to $15,000 per year and $50,000 in total, then apply to release eligible savings and associated earnings through the ATO. 

Eligibility depends on factors including citizenship or residency, prior property ownership, the property type and whether you'll live there as your principal place of residence.

This guide is general information and is not financial, legal or tax advice. Grants, schemes, thresholds and lending criteria can change. Confirm your eligibility with Revenue NSW, Housing Australia, your lender or broker, and your conveyancer before signing any contract.

What are the upfront and ongoing costs of buying a first home in Sydney?

Sydney first home buyers should budget for the deposit plus upfront costs of approximately $5,000 to $50,000+ depending on property type, lender and whether stamp duty duty is exempt. Upfront costs include legal and conveyancing fees ($1,200 to $2,500), lender fees, stamp duty duty (often $0 for eligible first home buyers under FHBAS), building and pest inspections for established homes ($400 to $800), and moving costs. Ongoing costs include mortgage repayments, council rates, insurance, utilities, maintenance and strata fees if applicable.

Upfront costs

• Legal and conveyancing fees: $1,200 to $2,500 for standard residential matters, plus disbursements such as title searches, council and planning certificates, and registration charges.
• Lenders Mortgage Insurance (LMI): For loans exceeding 80% of the property's purchase price, LMI covers lenders if defaults occur, and can add several thousand dollars or more depending on the loan size and lender.
• Stamp Duty: often $0 for eligible first home buyers under FHBAS up to $800,000, with a concessional rate to $1 million. Check the current Revenue NSW calculator for your purchase price.
• Other fees: loan application fees, independent valuer fees, title registration, and building inspections.

Ongoing costs after settlement

• Land tax: most first home buyers do not pay land tax on their principal place of residence. The general NSW threshold is currently $1,075,000, and a separate principal place of residence exemption usually applies. From the 2026 land tax year, the principal place of residence exemption requires resident owners to hold a combined ownership interest of at least 25%, which mainly affects multi-owner or trust arrangements rather than standard joint purchases. Confirm your situation with Revenue NSW.
• Mortgage repayments, council rates, home and contents insurance, utilities, ongoing maintenance, and strata fees if you buy an apartment or townhouse.

Worked example: a $750,000 new home purchase

A first home buyer purchasing a new $750,000 home and meeting eligibility criteria might access:

• $10,000 First Home Owner Grant at settlement (within the $750,000 house and land package cap)
• Concessional transfer duty under FHBAS (a saving of approximately $15,000 to $20,000 compared with the standard rate)
• 5% deposit ($37,500) instead of a 20% deposit ($150,000) under the Australian Government 5% Deposit Scheme, with no LMI

That's potentially $25,000+ in upfront support and a deposit roughly $112,500 lower than a non-scheme buyer. Numbers are illustrative; confirm with your lender, broker and Revenue NSW for your specific situation.

How do I buy my first home in NSW step by step?

To buy your first home in NSW: work out your budget and deposit, check eligibility for grants and schemes, get loan pre-approval, find and inspect a home, review the contract, exchange contracts and pay your deposit, finalise your finance, then settle and collect the keys. For completed homes, settlement is often around 4 to 6 weeks, depending on the contract. For homes under construction or off the plan, timing depends on the build stage and settlement terms. Allam's EasyBuy process simplifies this with fixed price contracts, no progress payments and no interest during construction.

• Check your budget and borrowing power.
• Save your deposit.
• Understand grants and stamp duty support.
• Choose your location and property type.
• Get legal review and finance ready.
• Make an offer or reserve your home.
• Exchange contracts.
• Settle and move in.
   

Make an offer or buy through the sales process

When you find a home you want to buy, you'll usually purchase by private treaty, auction, or directly from a developer. With a private treaty, you make an offer, and if accepted, a cooling-off period usually applies, granting you some leeway to reconsider. Auctions are more direct: win the bid and you commit immediately with no cooling-off. Buying direct from a developer like Allam works differently again, with a fixed price contract and a structured reservation process rather than an auction or open negotiation.

Settlement: claiming your new home

Settlement runs in clear stages: exchange contracts, observe any cooling-off period, finalise finance and legal checks, then settle and collect the keys. The settlement period is often around 4 to 6 weeks, depending on the contract.

With Allam, the EasyBuy process keeps this straightforward.

How Allam's EasyBuy process makes buying simpler

• Choose your home: At each estate, Allam has sales centres and homes for prospective buyers to explore. Discover a new ready built home that's right for you, from one that is finished, under construction, or off-the-plan. Pay a $1,000 reservation fee. The experienced Allam sales team is there to help with all your questions.
• Pay your deposit: Review the contract and specifications. Then secure your home by paying the deposit minus the reservation fee.
• Get your keys: Complete a final inspection led by Allam's building supervisors before you settle and receive your keys to move in.

EasyBuy means a fixed price, no progress payments, no interest during construction and no contract variations. The "no interest during construction" benefit refers to interest charged by Allam; your home loan with your lender works separately and may charge interest from settlement.

Frequently Asked Questions

What are the biggest first time home buyer mistakes?

Common mistakes include underestimating upfront costs (legal fees of $1,200 to $2,500, inspections, lender fees and moving costs can add up to $5,000+), skipping loan pre-approval, stretching the budget without a buffer for interest rate rises of 1% to 2%, and signing a contract without proper legal review. Choosing on emotion rather than fit for your stage of life is another frequent trap.

Who is exempt from the first home buyers grant in NSW?

The $10,000 FHOG isn't available to everyone. Buyers who have previously owned residential property in Australia, who aren't Australian citizens or permanent residents, or who buy an established home rather than a new build are typically not eligible. The grant only applies to new homes priced up to $600,000, or house and land contracts up to $750,000, and you must live in the home for at least 12 continuous months within 12 months of settlement.

What is the 28/36 rule in Australia?

Not formally. The 28/36 rule is a US budgeting guide, not an Australian lending rule. Australian lenders assess serviceability using their own criteria, including income, expenses, debts and interest rate buffers.