What is the minimum deposit required for a HomeStart loan?

The whole point of HomeStart Finance is to help South Australians into a home with a smaller deposit than mainstream lenders usually require. So the minimum deposit is genuinely low, but the exact figure depends on which HomeStart product you use and whether you are buying an established home or building a new one. Here is the current position, with the usual reminder that HomeStart figures are reviewed and can change.

The standard HomeStart deposit

With a standard HomeStart home loan, as at 2026, you can buy an established home with as little as a 5 per cent deposit, or build a new home with about an 8 per cent deposit. Compared with the 20 per cent that mainstream lenders often look for to avoid extra costs, that is a much lower bar to clear, and it can bring a purchase forward by years rather than months.

The Graduate Loan: as little as a 2 per cent deposit

HomeStart goes lower again for eligible graduates. Under the Graduate Loan, an eligible buyer can start with as little as a 2 per cent deposit to buy an established home, or 5 per cent to build. Eligibility is generally based on holding a Certificate III or higher qualification, and HomeStart also extends it to certain technical college graduates and to frontline police, firefighters and defence force personnel. If you might qualify, it is one of the lowest deposit pathways available in South Australia.

No Lenders Mortgage Insurance, on any loan

This is one of HomeStart biggest advantages and it is worth understanding properly. With most lenders, putting down less than a 20 per cent deposit triggers Lenders Mortgage Insurance, a cost that protects the lender, not you, and that can run into a significant sum on a low deposit loan. HomeStart does not charge LMI on any of its loans. So a small deposit with HomeStart does not carry the LMI cost it usually would elsewhere, which removes one of the biggest hidden expenses faced by low deposit buyers.

Why genuine savings still matter

A low deposit does not mean no checks on how you got there. HomeStart generally wants to see clear credit and a good savings history, because a pattern of steady saving shows you can manage regular repayments. So while the deposit hurdle is low, the habits behind your deposit still count. Saving consistently in the months before you apply strengthens your case, just as it would with any lender.

You still need more than the deposit

Whatever your deposit, it is not the only cash you need. Buying a home also involves upfront costs such as loan set up fees, government charges, and building and pest inspections, and for established homes, stamp duty, though South Australia has first home buyer concessions on eligible new homes. None of these are the deposit itself, but they need to be planned for, so it is wise to think of your minimum as the deposit plus a sensible allowance for these additional costs.

How grants and booster loans can reduce what you need

Your deposit does not have to come from savings alone. Eligible first home buyers building a new home may be able to put the South Australian First Home Owner Grant toward their deposit and costs, and HomeStart booster loans such as the Advantage and Starter loans can help bridge budget and upfront cost gaps. Combined, these can reduce how much you personally need to have saved before you can get started.

Buying established versus building

Notice that the deposit differs depending on whether you buy or build, a lower percentage to buy an established home and a slightly higher one to build. Building also brings the First Home Owner Grant into play, since the grant applies to new homes, which can offset the higher build deposit for eligible first home buyers. So the right path depends on your goals and eligibility, not just the headline percentage.

Owner occupied, South Australia only

It is worth repeating the boundaries, because they are firm. HomeStart lends only for homes you will live in, and only in South Australia. It does not finance investment properties or purchases in other states. Within those limits, the low deposit options are genuinely among the most generous available locally, which is the whole reason HomeStart exists.