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Purchase deposit

Organising Finances

Buying a property: How much deposit do I need?

While a good general rule for anyone planning to live in the property they buy is that they'll need a deposit of five to ten per cent of the property purchase price, this can vary depending on a number of factors.


These include the type of home loan you are seeking, as well as the lender you choose. Anyone purchasing a property for an investment is generally required to provide a deposit worth ten per cent of the purchase price.


Your deposit may come in the form of savings - usually from at least the past three months - as well as contributions from other avenues, which can include family assistance, gifts or bonuses.


What happens to the deposit paid to the agent?

When a contract is signed, a ten per cent deposit is usually required. This is generally not refundable, although in some cases, an agent may ask for a smaller amount to be paid when an offer is submitted. In this case, deposits are generally refundable, especially if the vendor chooses not to accept your offer.


If you pay your deposit to an real estate agent, it will be paid into a trust account they operate. No interest is payable from this type of account.


Certain states allow deposits to be held in an interest-bearing deposit account at a bank. You may wish to have your solicitor negotiate with the vendor's solicitor for any interest received to be shared equally between the purchaser and vendor.

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