Should I get a First Home Loan or save 20% deposit?

Short answer: If prices rise faster than the premium costs, buy sooner. If prices are flat, save 20%.

What this actually means in plain English

It depends on your timeline and the market. If prices are rising fast, buying sooner with 5% might save you money even with the 1% premium. If prices are flat or falling, saving 20% avoids the premium and gives you better rates. Do the math for your specific situation.

Key Facts

First Home Loan: 5% deposit + 1% annual premium
Standard loan: 20% deposit, no premium, better rates
Rising market: earlier entry may offset premium cost
Flat/falling market: 20% deposit is cheaper long-term

Example

House Price: $600,000

Option1 Deposit: $30,000 (5%)

Option1 Premium: $5,700/year

Option2 Deposit: $120,000 (20%)

Option2 Premium: $0

Break Even: If house rises $5,700/year, Option 1 wins

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