Beginner's Guide to Entering the Property Market

How Much Deposit Do You Actually Need?

Most NDIA employees can enter the property market with a 5% deposit using the Australian Government 5% Deposit Scheme. Some lenders also offer specialised public sector lending with reduced or waived LMI on deposits as low as 5% to 10%, depending on your role and tenure.

Consider a buyer working at the NDIA's Geelong office. With stable income and 12 months of continuous employment, they can access the 5% Deposit Scheme for properties up to $950,000 in regional Victorian centres. That allows entry into the property market without waiting years to save a 20% deposit.

The difference between a 5% and 10% deposit affects more than just timing. A 5% deposit under the scheme eliminates LMI entirely because Housing Australia guarantees the gap. A 10% deposit with a public sector lender may also avoid LMI through an employer-linked waiver, but eligibility depends on lender policy and your employment status. Confirming which option suits your circumstances before you start looking at properties will save time later.

Which Government Schemes Apply to You?

The 5% Deposit Scheme removed income caps and annual place limits from October 2025. That means you can apply regardless of how much you earn, and you will not be turned away because a quota has been reached. Applications are made through participating lenders, not directly through Housing Australia.

State-based grants and stamp duty concessions stack with the federal scheme in most cases. In Victoria, you can access a full stamp duty exemption on properties valued up to $600,000 and a sliding concession on homes between $600,001 and $750,000. If you are purchasing a new home valued under $750,000, a $10,000 grant also applies.

In Queensland, first home buyers of new homes valued under $750,000 receive a $15,000 grant. Stamp duty is fully waived on the residential land component of a new home with no price cap. For established homes, a first home concession reduces duty, though it does not eliminate it entirely. From August this year, at least one applicant must be an Australian citizen or permanent resident to access these concessions.

NSW offers a full stamp duty exemption on homes valued up to $800,000 and a sliding concession on properties between $800,001 and $1,000,000. A $10,000 grant applies to new builds or substantially renovated homes under $600,000, or land and build contracts under $750,000. The grant does not apply to established homes.

What Does Pre-Approval Actually Give You?

Pre-approval confirms how much a lender is willing to lend based on your income, expenses, and credit profile. It gives you a borrowing limit before you start attending inspections or making offers. Most pre-approvals are valid for three to six months, though conditions vary between lenders.

In our experience, buyers with pre-approval in place move faster when they find a property. Vendors and selling agents take offers more seriously when financing is already confirmed. In a market where multiple buyers are competing, having your loan ready means you can sign a contract without waiting weeks for conditional approval.

Pre-approval does not lock in your loan structure. You can still adjust your fixed and variable split, decide whether to include an offset account, or change your deposit amount before final approval. What it does lock in is your borrowing capacity, so you know which price range to focus on when you start looking.

How to Use Offset Accounts and Redraw Effectively

An offset account is a transaction account linked to your home loan. The balance in the account reduces the interest charged on your loan without locking your money away. If you have a $500,000 loan and $20,000 sitting in an offset account, you only pay interest on $480,000.

Redraw allows you to access extra repayments you have made above the minimum required amount. The feature is useful if you make lump sum payments and want the option to withdraw funds later. Some lenders restrict redraw on fixed rate loans, so confirm the terms before deciding on your loan structure.

For NDIA employees with variable income from overtime or allowances, an offset account offers more flexibility than redraw. You can move money in and out without requesting a withdrawal, and the balance reduces your interest daily. Redraw may suit buyers who prefer to make extra repayments but want access to those funds if circumstances change.

Should You Fix Part of Your Rate?

Fixed rates lock in your interest rate for a set period, typically one to five years. Variable rates move up or down depending on lender decisions and broader economic conditions. A split loan structure lets you fix part of your loan and keep the rest variable.

A buyer purchasing in Canberra might fix 50% of their loan for three years to protect against rate increases while keeping 50% variable to take advantage of an offset account and the flexibility to make extra repayments. That structure provides some certainty around repayments without removing all flexibility.

Fixed rate loans often come with restrictions. You may not be able to make extra repayments beyond a capped amount, redraw may be unavailable, and break costs apply if you refinance or sell before the fixed term ends. Variable loans allow unlimited extra repayments, full access to offset accounts, and no penalties for paying out the loan early. Deciding which structure suits you depends on how much flexibility you need and how much rate certainty you value.

Where Public Sector Employment Makes a Difference

Several lenders offer discounted interest rates or waived LMI to public sector employees, including NDIA staff. These benefits are not automatic. You need to apply through a broker or lender that has access to public sector lending programs, and you will need to provide evidence of your employment.

LMI waivers for public sector employees typically apply at deposits between 10% and 15%, depending on the lender and your role. Some lenders extend the waiver to 5% deposits for specific occupations or employment categories. Combining a public sector LMI waiver with state stamp duty concessions can reduce the upfront cost of buying your first home significantly.

Interest rate discounts linked to public sector employment are usually small, often between 0.10% and 0.30%, but they apply for the life of the loan unless you refinance. Over a 30-year loan term, even a 0.20% discount can reduce the total interest you pay by several thousand dollars.

What Genuine Savings Means and Why It Matters

Most lenders require at least 5% of your deposit to come from genuine savings, which means funds you have saved over at least three months. Savings held in your bank account, term deposits, and shares typically qualify. Funds received as a gift, a tax refund, or a bonus may not.

If part of your deposit is a gift from a family member, lenders will usually accept it as long as it is declared and supported by a statutory declaration. The gifted portion does not count toward genuine savings, so you will still need to show that you have saved a portion of the deposit yourself. Lenders assess genuine savings to confirm that you can manage money and that you are not borrowing the deposit from another source.

Some lenders relax genuine savings requirements for public sector employees with stable income and a clean credit file. If you do not meet the standard savings threshold, discussing your circumstances with a broker who understands public sector lending can clarify whether alternative options exist.

Call one of our team or book an appointment at a time that works for you. We work with NDIA employees across Australia and understand how public sector employment affects your borrowing options. If you are ready to start looking at properties or want to confirm your borrowing capacity before you begin, we can walk you through the application process and help you access the schemes and lender benefits that apply to your situation.

Frequently Asked Questions