How to buy a house without a deposit

You don’t always need a large cash deposit to buy a house in Australia, with several strategies now letting buyers act without tying up their savings.

That’s welcome news, because saving the traditional 20% can feel overwhelming, with tighter lending criteria, a rising cost of living and prices that over the long term typically continue to increase. Here’s how to buy a home without a deposit.

It’s important to remember that this article is general information only and not financial advice. Speak to a licensed mortgage broker or financial adviser before making decisions.

Key takeaways

From cash to confidence: how modern buyers approach deposits differently

For most buyers, the question worth asking has shifted from, “How do I save the upfront cash deposit?” to “What’s the best deposit strategy for me?” Buyers used to wait years while a 20% deposit slowly accumulated, and that savings account was the whole plan.

Fortunately, the market has changed: flexibility, timing and liquidity now matter as much as the balance in your account, so more buyers draw on a mix of equity, government schemes, family guarantees, deposit bonds and new platforms to act sooner without locking up cash.

In property, the word ‘deposit’ covers three different things:

Can you really buy a house with no cash deposit?

Yes, you can buy a house with no cash deposit in Australia with the right strategy behind the purchase. No deposit home loans exist here too, but they almost always require either a guarantor, equity, a government scheme or an alternative platform to make up the difference.

Most pathways still ask for something, and lenders will always test your ability to repay the loan. What none of them require is a large lump sum of cash sitting in your account.

So, how can you buy a house with no deposit in practice? The strategies below cover buying with no money down from every angle, from using equity instead of a cash deposit through to guarantor loans, government schemes, deposit bonds and alternative platforms.

Ways to buy a house with no cash deposit

There are several proven strategies for entering the market without a large cash deposit, and most buyers combine two or more. Here’s how they compare at a glance.

Use existing equity

If you have equity in an existing home or investment property, you can borrow against it to fund the deposit on your next purchase. Using equity instead of a cash deposit is one of the most common ways to buy a second property with no deposit saved, because the wealth you’ve already built does the heavy lifting.

Arrange same day settlement or drawdown of both loans to keep interest costs down, and remember that borrowing over 80% LVR will usually incur LMI. Once you have formal approval, a deposit bond can replace the 10% cash deposit at exchange, keeping your funds free until settlement.

• Pros: You stay in control of the purchase, and you grow wealth using assets you already own.
• Cons: Equity is finite and tied to property values, so market conditions can shrink it. To free up enough equity to pay the deposit, you may also have to sell the property first, which you might not be ready to do.

Get a guarantor loan

A guarantor loan removes the need for a cash deposit by using a family member’s equity instead of yours. The guarantor, often a parent, provides a limited guarantee equivalent to around 20% of the purchase price plus costs such as stamp duty, also called a family guarantee.

You avoid LMI and get into the market sooner without a cash deposit.

The responsibilities deserve careful thought. The guarantee stays in place for the life of the loan unless it’s removed, usually by refinancing once you’ve built enough equity. The guarantor takes on real risk if you default, so both sides should get independent financial and legal advice first.

• Pros: It uses someone else’s equity, avoids LMI and gets you a foothold in the market.
• Cons: It relies on a family member’s willingness and financial position, and exposes them if you can’t repay.

Partnership or joint ventures

Buying with a partner, sibling or friend lets you pool resources and share the deposit burden. Most partnerships purchase as tenants in common, with each party owning a set percentage. One point catches people out: all owners are jointly responsible for the full debt regardless of ownership share, so if one person stops paying, the others carry the entire loan.

Even the strongest relationships need a written agreement covering who makes day to day decisions, how disputes are resolved, and what happens if one partner wants to sell.

• Pros: Pooling resources shares the risk and opens up properties one buyer couldn’t afford alone.
• Cons: Joint debt liability is unavoidable, and a personal falling out can affect the investment.

First Home Guarantee (5% Deposit Scheme)

The First Home Guarantee lets eligible first home buyers purchase with a 5% deposit and no LMI, with the government guaranteeing the remaining portion of the deposit requirement. The scheme, administered by Housing Australia, expanded significantly in October 2025. There are now no income caps, no waitlist and higher price caps, including up to $1.5 million in NSW, $1 million in Queensland, $950,000 in Victoria and $850,000 in WA.

If you’re weighing the 5% Deposit Scheme against a true no deposit strategy, remember the scheme still requires a genuine 5% deposit.

There’s also a timing wrinkle: many contracts still ask for a 10% deposit at exchange, double what scheme buyers have saved. A deposit bond can help eligible buyers meet that deposit obligation while keeping cash available for stamp duty, conveyancing and moving costs.

Use a deposit bond

A deposit bond is an insurance backed guarantee that replaces the cash deposit required at exchange of contracts, letting eligible buyers secure a property without tying up funds before settlement. Deposit bonds are especially useful for off-the-plan apartments and house and land packages, where settlement can be months or even years away.

Rather than leaving 10% of the price locked in a trust account for the whole construction period, a deposit bond keeps that money working for you until settlement, when you pay the full purchase price as normal.

• Pros: preserves cash during the build period, reduces the need for a large upfront cash deposit and is commonly used for off-the-plan and house and land purchases.
• Cons: a one off fee applies, eligibility criteria apply and acceptance is subject to the developer or vendor.

If you’re curious what a bond would cost, the deposit bond calculator gives you a quote in a couple of minutes.

Other government support (if you’re a first home buyer)

The federal government runs three other schemes that lower the deposit for first home buyers:

1. Family Home Guarantee – Eligible single parents and legal guardians can buy with a 2% deposit and no LMI.
2. Help to Buy – The shared equity scheme where the government contributes up to 40% of a new home’s price or 30% of an existing one, with the buyer putting in a 2% deposit. Income caps apply.
3. First Home Super Saver Scheme – You add extra money to your super, then withdraw up to $50,000 of those contributions plus earnings for your first home, or $100,000 pooled as a couple.

Alternative deposit platforms

More and more alternatives are emerging in this space, with lenders and challenger brands helping buyers secure property without an upfront cash deposit.

The simplest is the deposit bond from Deposit Power, which isn’t a loan at all but a guarantee covering the deposit at exchange for a one off fee, leaving your cash untouched until settlement.

Co-deposit takes a different approach for brand new properties, where buyers put down $10,000 and pay the rest of the deposit in weekly instalments while their home is built. Alternatively, Zeroo funds 100% of the purchase price through a shared equity home loan and takes a share of the property’s value when you refinance.

OwnHome’s Deposit Boost pairs a second loan covering up to a 20% deposit with your main mortgage, aimed at high income buyers with limited savings. All four charge a fee or share in your property’s growth in some way, so weigh the cost against getting in sooner.

Which strategy suits which buyer?

At the end of the day, only you can decide the right way forward for your circumstances and goals.

But that decision will be easier if you seek professional advice and take steps to understand all the options available to you. Chances are, there’s a solution out there that’s got just what you need. No two buyers walk into the market with the same finances, so match the strategy to your situation below.

• First home buyers: Check your eligibility for the First Home Guarantee first, since a 5% deposit with no LMI beats most alternatives. If the price caps don’t fit your market or the 5% is out of reach, a guarantor loan can bridge the gap. Among the best tips and advice for first time home buyers: get pre approval early, and work through a first home buyer checklist so the rest of the process stays on track.
• Upgraders buying before selling: Your equity is your deposit strategy. Borrow against your current home to fund the purchase, then use a deposit bond to cover the deposit at exchange while your sale settles, so you’re never forced to move cash twice.
• Investors: Existing equity remains the classic route to buy an investment property with no deposit saved in cash, and partnerships can stretch your reach further. For off-the-plan purchases, a deposit bond keeps your capital invested during construction. If you’re researching how to get into property development with no money upfront, joint ventures paired with equity lending are where most people start, though the risks scale with the ambition.
• Downsizers: You likely have significant equity tied up in your existing home but need to secure the next property before selling. Leveraging that equity, bridging arrangements and deposit bonds can each help you manage the transition without freeing up all your cash upfront or rushing your sale.
• Auction buyers: When the hammer falls, you need to exchange on the spot. A deposit bond arranged before you bid means signing on the day without organising a bank cheque or moving cash, and pre approval means bidding within your limit. As no deposit options for an auction buyer go, that combination is hard to beat.

How deposit bonds fit across every strategy

Most of the strategies above share a pressure point, and that’s the deposit due at exchange. A deposit bond replaces that upfront cash deposit with a guarantee, which is why it pairs naturally with so many of the pathways here. Equity buyers use a deposit bond to avoid drawing down funds early, off-the-plan buyers use them to keep savings working during construction, and upgraders and downsizers use them to bridge buying and selling without having to sell early. Auction buyers get a particular edge, because a bond means bidding without organising a bank cheque.

Whichever strategy fits, check early that the vendor accepts deposit bonds, get familiar with how deposit bonds work, then arrange yours so it’s ready when the right property appears.