How to Plan Your Entry Into the Property Market — The Smart Way
Let’s be honest — being a first home buyer in today’s market can feel like pushing a boulder uphill in a headwind. Prices are high, advice is all over the place, and the banks seem to speak their own language.
But it can be done — and done well — if you take a strategic approach. I’ve helped plenty of first-home buyers get into the market without sacrificing their lifestyle or sanity. The key? Knowing where you stand, what your options are, and what actually matters to lenders.
Here’s my breakdown of how to plan your move into the market — plus a few insider tips I’ve picked up after years working both as a financial adviser and mortgage broker.
1. Check Your Credit File — Before the Banks Do
Most people don’t think to check their credit report until they're already applying for finance. But here's the thing: if there's a hiccup on your file — like a default you didn’t know about, or an old credit card that never got closed — it can ruin your chances of approval or bump up your rate.
Jump onto Equifax and request a free credit report. What you’re looking for is:
Your credit score
Any listed debts or defaults
Anything unusual you didn’t know about
If something doesn't look right? Reach out to the provider and ask how to fix it. Some defaults can be removed once they're settled, and it's far better to get that sorted now than mid-way through trying to buy a home. Some credit files a bit more tricky, I’d recommend reaching out to a credit repaired in this instance.
2. Work Out What You Can Afford — Not What the Bank Will Give You
I can’t stress this enough: just because a bank says you can borrow $750,000 doesn’t mean you should. I’ve been there myself. But the reality is, lenders don’t factor in lifestyle. They don’t know if you want to travel next year, have a kid, or keep your Friday night Uber Eats habit alive.
When I work with clients, we don’t start with the bank’s borrowing capacity. We start with your repayment comfort zone. What can you afford to repay each month and still live your life?
If you’re currently renting, that’s a great place to start. I often look at what you're paying in rent, add how much you're saving on top of that, and use that as a baseline. From there, we figure out whether:
You could comfortably stretch a little more
You’ve hit your ceiling
Or you might need to trim back a little to make it work
Then we align that with your borrowing power and property goals — and if the numbers don’t stack up? We work out what gives: is it the house, the location, the timeline, or maybe the idea altogether?
3. Get Smart About Your Borrowing Capacity
Your borrowing capacity is basically your bank-approved budget — but it’s not just about your income. Lenders look at the full picture: your expenses, existing debts, dependants, and even your day-to-day spending habits.
Some things that seem minor (like a HELP debt or Afterpay account) can seriously impact what a lender is willing to offer. But the good news? There are some simple ways to give your borrowing power a healthy boost.
Boosters – What Helps Your Borrowing Power:
Pay off or consolidate personal/car loans
Reduce the limit on your credit cards or cancel unused ones
Lower your personal or car loan limit (if possible)
Pick up consistent overtime or extra shifts to increase income
Keep your transaction history tidy — cut out things like gambling, excessive food delivery, etc.
I've seen people increase their borrowing by tens of thousands just by making a few of these changes.
Drainers – What Hurts Your Borrowing Power:
HELP/HECS debt – treated like a loan and reduces your serviceability
Credit card limits – lenders assess the full limit, not just the balance owing
Buy Now Pay Later services (Afterpay, Zip, etc.) – major red flag for many banks
Private health insurance – adds to monthly expenses (not saying cancel it, but be aware)
Tax debts – especially if you’re not on a payment plan
High discretionary spending – Uber Eats, subscriptions, etc., can all add up and impact your profile
Any outstanding debt – whether it’s personal, car, or business-related
4. Understand Your Purchasing Strategy to Enter the Market
You don’t need a 20% deposit to buy a home — there are plenty of creative and accessible ways to get started, even if you're not sitting on a huge pile of savings.
Here are a few common options:
Low Deposit Loans
5–10% deposit – Often includes Lenders Mortgage Insurance (LMI), but can fast-track your entry.
Deposit loans (0–5%) – Borrowing your deposit may cost more upfront, but could still be better than staying stuck in the rental cycle.
Government Schemes
First Home Guarantee – Buy with as little as 5% deposit and no LMI (if eligible).
Single Parent Guarantee – Just 2% deposit required, no LMI.
Shared Equity Schemes – Co-purchase a property with the government (available in some states). You own the home, but the government helps fund part of it in exchange for a share in the property. Great for reducing the upfront cost.
Family Assistance
Guarantor loans – A family member uses their property as security to help you avoid LMI.
Gifted funds – A lump sum from family that can form all or part of your deposit.
Co-Buying Options
Co-purchasing with family or friends – Combine resources to buy together and increase borrowing power.
I’ve put together a detailed e-guide that breaks these down further (plus a few more options you might not have heard of). If you'd like a copy, just reach out via the contact form.
5. Know the Real Costs of Buying a Home
Buying a property involves more than just the deposit and the loan — there are several upfront costs you’ll need to factor in to avoid surprises.
Here are the key ones to be aware of:
Stamp Duty – A government tax based on the purchase price. Here is a great calculator to visualize these costs: https://www.realestate.com.au/home-loans/stamp-duty-calculator
Mortgage Registration Fee – Charged to register the lender’s interest in the property.
Transfer Fee – Covers the cost of transferring the title into your name.
Conveyancing / Legal Fees – For handling the legal side of the transaction (budget around approximately $1,500).
Lender Fees – May include application, settlement, valuation, or annual package fees.
Building & Pest Inspection – Highly recommended before buying to check for structural issues, water damage, or termites. It could save you thousands in future repairs.
6. Get a Proper Pre-Approval Before You Start Shopping
I always tell clients: don’t go house-hunting until you’ve got your finance game plan sorted.
A genuine, credit-assessed pre-approval helps you:
Know your budget
Act fast when you find the right place
Negotiate confidently with agents
If going through a broker, at this stage, you’ll also have a crystal clear picture of the strategy and how much cash you will need to also fulfil the purchase.
Beware of those 2-minute online “pre-approvals” — most of them are automated and don’t mean much when it comes time to actually buy.
7. Don’t Fall Into the First-Home Buyer Traps
You know the saying, “you don’t know what you don’t know”? It absolutely applies here.
Buying your first home can be exciting — but there are a few common traps that can derail your journey.
Here are the big ones to avoid:
Trying to do it alone – This is where a good broker can save you serious time, stress, and potentially money.
Choosing a loan based only on interest rate – The structure and features of your loan matter just as much (if not more) over the long term.
Giving up after a few knockbacks – I’ve seen countless people persist through early setbacks and end up buying a home even better than the ones they missed.
Feeling too overwhelmed to even start – Taking the first step is often the hardest, but once you do, momentum builds quickly.
Waiting for the market to fall – I’ve spoken to people who’ve been “waiting for the drop” since 2012. Meanwhile, prices have doubled.
Remember: a home loan isn’t just about buying a house — it’s about building the foundation for your next 10+ years. Get the structure right, and everything else becomes easier.
Especially with the right guidance behind you.
Final Thoughts: The Smart Way Is Your Way
There’s no perfect formula to buying your first home — because there’s no one-size-fits-all version of you.
The smart way into the market isn’t about being lucky or rich. It’s about understanding your numbers, using what’s available to you, and making confident, informed decisions.
Ready to take the next step the smart way?
You don’t need to have it all figured out. You just need a starting point — and the right support to guide you from there.
Whether you’re still saving, stuck on strategy, or second-guessing your numbers… I’m here to help.
💬 Contact Blake via the contact form, or book a meeting for a clear, no-pressure chat about your options.
Let’s make your first home happen — on your terms.
