Last updated: July 2026
10 First Home Buyer Mistakes to Avoid in 2026
Australian first home buyers have access to more government support than ever, but it is easy to leave money on the table or make costly errors. From missing FHSS contribution deadlines to skipping building inspections, these ten mistakes cost first home buyers thousands of dollars every year. Here is what to watch for and how to avoid each one.
1. Not Checking Scheme Eligibility
Many first home buyers do not realise how many schemes they qualify for. The FHSS, FHBG, Help to Buy, state grants, and stamp duty concessions can be stacked together (with some exceptions). Missing even one scheme could cost you tens of thousands of dollars.
How to avoid it: Check your eligibility for every scheme before you start looking at properties. Our scheme calculator checks all schemes in under two minutes.
2. Missing the FHSS Contribution Window
The FHSS lets you save up to $15,000 per financial year and $50,000 total inside super at a lower tax rate. But contributions must be made before 30 June each year to count for that financial year. If you miss the deadline, you lose that year's $15,000 allowance permanently.
How to avoid it: Set up salary sacrifice or make personal deductible contributions well before 30 June. Even a partial contribution is better than missing the window entirely.
Read our FHSS salary sacrifice strategy guide
3. Forgetting About Extra Costs
The deposit is not the only upfront cost. First home buyers regularly underestimate how much they need on top of the purchase price. Common additional costs include:
- Stamp duty (unless exempt in your state)
- Conveyancing fees: $800 to $2,500
- Building and pest inspection: $500 to $900
- Loan application or establishment fees
- Home and contents insurance
- Moving costs
- Council and water rates (adjusted at settlement)
- Strata levies for apartments
How to avoid it: Budget an additional $10,000 to $20,000 on top of your deposit for these costs. See our full breakdown of hidden costs.
4. Skipping the Building and Pest Inspection
A building and pest inspection costs $500 to $900. Structural repairs or termite damage can cost tens of thousands. Skipping the inspection to save money is one of the most expensive mistakes a first home buyer can make.
How to avoid it: Always get a building and pest inspection before exchanging contracts (or before auction day if buying at auction). Read our building and pest inspection guide.
5. Borrowing the Maximum Amount
Just because a lender will lend you a certain amount does not mean you should borrow it all. Lenders stress-test your application at a rate roughly 3% above your actual rate, but that buffer can be tight if interest rates rise further, your income changes, or unexpected expenses arise.
How to avoid it: Aim to keep mortgage repayments under 30% of your gross income. Build in a buffer for rate rises of at least 1 to 2 percentage points above your current rate.
6. Not Getting Pre-Approved
Searching for properties without knowing how much you can borrow wastes time and can lead to disappointment. Pre-approval gives you a clear budget and shows sellers you are a serious buyer.
How to avoid it: Get pre-approved before you start inspecting properties. Pre-approval typically lasts 3 to 6 months. Read our pre-approval guide.
7. Choosing the Wrong Guarantee Scheme
The FHBG and Help to Buy both reduce your deposit requirement, but they work very differently. The FHBG lets you own 100% of your property with 5% deposit. Help to Buy requires only 2% deposit, but the government co-owns up to 40% of the property and shares in capital gains. They are also mutually exclusive: you cannot use both.
How to avoid it: Compare both schemes for your specific situation. See our FHBG vs Help to Buy comparison.
8. Not Using a Conveyancer
A conveyancer or property solicitor handles the legal side of your purchase: contract review, title searches, settlement, stamp duty concession applications, and FHOG paperwork. Trying to do this yourself to save $800 to $2,500 risks making an error on the most expensive transaction of your life.
How to avoid it: Engage a conveyancer before you make an offer. They can also review the contract of sale before you sign. Read our conveyancing guide.
9. Rushing the Decision
Fear of missing out drives many first home buyers to make quick decisions they later regret. Buying under pressure often leads to overpaying, skipping due diligence, or choosing a property that does not suit your actual needs.
How to avoid it: Set a clear budget before you start looking. Attend open homes for a few weeks before making offers so you understand market prices. If you feel pressured by a real estate agent, step back. There will always be another property.
10. Assuming Scheme Rules Never Change
State and federal first home buyer schemes are updated regularly, usually from 1 July each year. Relying on outdated information can mean you plan around a grant or concession that has already stepped down, or miss one that has recently improved:
TAS stamp duty exemption: lapsed
Tasmania's 100% stamp duty exemption for first home buyers of established homes (up to $750,000), along with the separate 50% off-the-plan concession, lapsed on 30 June 2026 and was not extended. First home buyers in Tasmania now pay full standard duty. The Tasmanian FHOG of $20,000 for new homes (stepped down from $30,000 on 1 July 2026) still applies.
NT HomeGrown Territory Grant: $50,000
The Northern Territory offers $50,000 for new builds and owner-builders under the HomeGrown Territory Grant, with no price cap, for contracts until 30 September 2027. The separate $10,000 grant for established homes ceased for contracts signed after 30 September 2025 and is no longer available.
WA FHOG price cap: raised
Western Australia raised its First Home Owner Grant property cap from $750,000 to $800,000 south of the 26th parallel (Perth and the South West) from 7 May 2026. The grant amount is still $10,000.
How to avoid it: Always check the current rules before you budget or sign a contract, rather than relying on figures you read a year ago. Our calculator applies the current rules for every state.
See all state grants and their current thresholds
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Frequently Asked Questions
What is the biggest mistake first home buyers make?
Not checking their eligibility for government schemes before buying. Many first home buyers miss out on the FHSS, FHBG, Help to Buy, state grants, and stamp duty concessions simply because they did not know they qualified or did not apply in time. Use our calculator to check every scheme you qualify for before you start looking.
Can I still get the QLD $30,000 FHOG in 2026?
Yes. The Queensland Government extended the $30,000 First Home Owner Grant for a further four years in the 2026-27 State Budget, so it continues for eligible contracts signed from 1 July 2026 onwards. There is no need to rush a contract before a deadline. The grant still applies to new homes valued under $750,000.
Do I need a conveyancer or can I do settlement myself?
You can legally do your own conveyancing in most states, but it is strongly not recommended. A conveyancer or solicitor handles contract review, title searches, settlement, and scheme applications. The cost (typically $800 to $2,500) is small compared to the risk of a mistake on what is likely the largest purchase of your life.
What happens if I borrow the maximum amount and interest rates go up?
Your repayments increase, potentially beyond what your budget can handle. Lenders stress-test your application at a rate roughly 3% above your actual rate, but this buffer can still be tight if your expenses increase or your income changes. Borrowing below your maximum gives you breathing room for rate rises and unexpected costs.
Sources:
ATO: First Home Super Saver Scheme | Housing Australia: First Home Guarantee | QLD Government: First Home Owner Grant | NT Government: Home Owner Assistance
Disclaimer: This information is general in nature and does not constitute financial, legal, or tax advice. Calculations are estimates only and may not reflect your exact circumstances. Eligibility criteria and dollar amounts may change without notice. Always verify with the relevant government authority, your mortgage broker, or a licensed financial adviser before making decisions.