Smart ways to approach your first property search

Start With Your Finance Position, Not Your Wishlist

Your property search should begin with a clear understanding of what you can borrow and what you can actually afford to repay. Speaking with a mortgage broker in Adelaide before you attend a single open inspection gives you a realistic price range and helps you understand which suburbs fall within your budget. Pre-approval also shows agents and sellers that you are a serious buyer, which matters in a market where competition can be strong.

South Australia offers a $15,000 First Home Owner Grant for new homes valued up to $650,000, and no stamp duty on properties up to $650,000 for eligible buyers. If you are buying a new home above that value, stamp duty is still waived entirely. This removes a significant upfront cost and can change which suburbs become affordable.

Consider a buyer with $50,000 saved and borrowing capacity of $550,000. Without stamp duty, they can target properties up to $600,000 in areas like Christies Beach or Salisbury, where median prices sit comfortably within that range. If they were required to pay stamp duty, their effective budget would shrink by around $20,000 to $25,000, pushing them into older stock or further out.

How the First Home Guarantee Changes Your Deposit Strategy

The federal First Home Guarantee allows eligible buyers to purchase with as little as a 5% deposit without paying Lenders Mortgage Insurance. This scheme was expanded significantly in late 2025, removing income caps and place limits. For someone buying a $500,000 property, that means a deposit of $25,000 instead of $100,000, and no LMI cost of around $15,000 to $20,000.

This does not mean you should always aim for the smallest deposit possible. A larger deposit reduces your loan amount, lowers your ongoing repayments, and may open up access to better interest rate discounts. It also gives you more flexibility if property values shift or your circumstances change.

In practice, we regularly see buyers who have saved 10% or more still choose to use the Guarantee and keep the remainder of their savings in an offset account. This gives them a buffer for repairs, furniture, or rate rises while still avoiding LMI. The key is to understand that the Guarantee is a tool, not a mandate to stretch your budget.

Where to Focus Your Search in Adelaide

Location matters, but affordability matters more if you are buying your first home. Suburbs like Salisbury, Christies Beach, and Elizabeth offer detached homes well under the $650,000 threshold, meaning you can take full advantage of the stamp duty concession and grant if buying new. These areas are also well connected by public transport and have established local amenities.

If you prefer proximity to the CBD, areas like Norwood or the inner eastern suburbs will push you closer to or beyond the $650,000 cap, meaning you may pay some stamp duty on established homes. For buyers in this position, a unit or townhouse in these suburbs can still fall within the concession range and offer lifestyle benefits that matter over the long term.

Do not choose a suburb solely because it qualifies for a concession. If a property in Norwood costs $700,000 and requires $18,000 in stamp duty, but suits your lifestyle and work location better than a $500,000 home in a suburb that adds 90 minutes to your daily commute, the stamp duty cost may be worth it. Your deposit and borrowing capacity should guide your search, but your decision should factor in how you will actually live.

Using the First Home Super Saver Scheme to Build Your Deposit

The First Home Super Saver Scheme allows you to make voluntary concessional contributions into your superannuation fund and then withdraw them for a first home deposit. You can contribute up to $15,000 per financial year and withdraw a total of up to $50,000. Because these contributions are taxed at 15% rather than your marginal rate, this can be a faster way to build a deposit if you are earning above $45,000 per year.

As an example, someone earning $75,000 per year who salary sacrifices $15,000 over three years will save around $4,500 in tax compared to saving the same amount in a standard bank account. When withdrawn, the amount is taxed again at a concessional rate, but the overall benefit is still significant.

This scheme works well if you are planning ahead and have at least 12 months before you intend to buy. It is less useful if you are ready to purchase within the next few months, as contributions need to be held in super for a minimum period. Speak with a mortgage broker or financial adviser to confirm whether this approach fits your timeline.

What to Look for During Inspections

Once you have your finance sorted and a shortlist of suburbs, your focus should shift to the condition and suitability of individual properties. Look for structural issues, water damage, and the age of major components like the roof, hot water system, and electrical wiring. These are the things that cost money after settlement and can derail your budget if you have used all your savings for the deposit.

For first home buyers using a low deposit option, having a building and pest inspection is critical. You will have limited cash reserves after settlement, so discovering a $15,000 plumbing issue three months in can be a serious problem. Budget $500 to $800 for a combined inspection and make your offer conditional on a satisfactory report.

Also consider the ongoing costs of ownership. A larger home on a bigger block may fit your wishlist, but if the rates, insurance, and maintenance costs push your budget too tight, the property becomes a liability rather than an asset. Your borrowing capacity might allow you to borrow $600,000, but that does not mean you should.

New Versus Established Homes and How It Affects Your Grants

The $15,000 First Home Owner Grant in South Australia applies only to new homes valued up to $650,000. A new home is defined as one that has not been previously occupied or sold as a place of residence. This includes house and land packages, newly built homes, and substantially renovated properties that meet specific criteria.

If you are buying an established home, you will not receive the grant, but you will still benefit from the stamp duty concession if the property is under $650,000. For some buyers, the trade-off makes sense. Established homes in well-located suburbs may offer better land size, established gardens, and proximity to schools and transport.

For others, particularly those buying in growth areas, a new home may offer the grant, lower maintenance costs, and modern energy efficiency. The decision should come down to your priorities and the specific properties available in your price range. Do not assume new is always better, and do not dismiss established homes purely because they do not attract the grant.

Structuring Your Loan Application for Long-Term Flexibility

When applying for a home loan, consider whether a split loan structure makes sense for your situation. This involves splitting your loan into fixed and variable portions, giving you rate certainty on part of the loan while maintaining access to an offset account on the variable portion.

For someone borrowing $500,000, they might fix $300,000 for three years to protect against rate rises, and leave $200,000 variable with an offset. This allows them to park their savings in the offset and reduce interest on the variable portion, while still having certainty on the majority of their repayments. It is a useful approach if you expect your income to increase or plan to make extra repayments over time.

Not all lenders offer the same flexibility, and some charge higher rates or fees for split structures. This is where working with a mortgage broker in Adelaide makes a difference, as they can compare loan features across multiple lenders and show you the real cost of each option.

If you are ready to start searching for your first home in Adelaide, or you want to confirm your borrowing capacity and deposit requirements before you begin, call one of our team or book an appointment at a time that works for you.

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