Can you afford a $600,000 home? Here’s how much you’ll need to get started

Collage of a woman thinking about the costs of buying her $600,000 home.

If you’re a home buyer in an Australian capital city, odds are finding anything below $600,000 is a minor miracle. But miracles happen every day, and Australia's average mortgage size is only $593,000. For the savvy borrower, this is quite achievable. 

So let’s look into how much money you realistically need to buy a $600,000 home in Australia, including the main home loan costs to consider.  

How much do you need to buy a $600,000 home loan?

Whenever you take out a home loan, you will be asked to contribute an upfront deposit (typically 20% of the property purchase price) and cover any fees and government charges, like:

  • Loan application and settlement fees. 
  • Mortgage broker fees.
  • Conveyancing fees.
  • Property valuation fees.

Depending on the loan or lender, these fees can run into the hundreds. You may also have to pay stamp duty, but if you’re a first home buyer, you might be eligible to have this tax waived depending on where you live. 

What home loan costs you can afford upfront will depend on your financial situation and any government or financial support you receive. Loan costs and borrowing power vary by home loan lender, too, so one offer may require more money from you than another. 

This is why comparing home loans is vital before jumping into the housing market. 

How much deposit do you need to buy a $600,000 home?

Woman considers the size of her home loan deposit.

If you’re buying a $600,000 home, a 20% deposit is $120,000. This would establish your 80% loan-to-value ratio (LVR) and make you eligible for competitive interest rates. 

You could buy with a smaller deposit, but you may also have to pay Lenders Mortgage Insurance (LMI), a fee that can add thousands of dollars to your mortgage repayments. Your interest rate will likely be higher, too, since high LVRs cop high interest rates

If you buy with a 10% deposit, you will need at least $60,000. Some lenders let you buy with as little as 5%, which would mean you only need $30,000. But you will likely have to pay LMI for both these deposit amounts. 

If you want to buy with a smaller deposit but avoid LMI and high interest rates, you could consider the following:

These can all lower the upfront costs of a home loan in Australia.

How much income do you need to buy a $600,000 home?

Woman points to the $600,000 house she can afford on her income.

Let’s consider an average scenario in Australia to establish a timeline, salary, and the amount of genuine savings it takes to buy a $600,000 home. 

If you buy a $600,000 home with a 20% down payment, your home loan value will be $480,000. Let’s say you’re an owner-occupier making principal and interest payments with a loan term of 25 years, at the current Mozo database average interest rate of 6.60%. 

According to the Mozo mortgage repayment calculator, you would be repaying $3,271 monthly. In Australia, you are under so-called ‘mortgage stress’ if you spend more than 30% of your monthly income on repayments. In order to meet this threshold, your after-tax income should be at least $10,903 monthly ($130,840 yearly). Before tax, your yearly salary will need to be at least $189,000. 

Say this is doable for high-income earners or a couple on a dual income. How long would it take to save for the 20% deposit? (Not including stamp duty). 

  • If you save $2000 a month, you will have your $120,000 deposit in 5 years. 
  • If you save $4000 a month, you will have your $120,000 deposit in 2.5 years. 
  • If you save $5000 a month, you will have your $120,000 deposit in 2 years.
  • If you save $10,000 a month, you will have your $120,000 deposit in just one year.

Storing your savings in a high interest savings account could help you grow your nest egg faster, especially if you have a good interest rate. Keep in mind that interest earned in a savings account counts as taxable income. 

Check out Mozo’s budget calculator to see how much you can save a month.

Try Mozo’s borrowing power calculator to see how large a home loan you can afford. Ready to compare? Browse home loan options in the table below.

Compare home loans - last updated 2 December 2023

Search promoted home loans below or do a full Mozo database search . Advertiser disclosure
  • Home Variable Rate

    Owner Occupier, Principal & Interest, Refinance Only

    variable rate
    comparison rate
    Initial monthly repayment
    6.15% p.a.
    6.15% p.a.

    Enjoy a competitive variable interest rate from Up. No application, monthly, annual, redraw, or discharge fees to pay. Up to 50 free offset accounts available. Up home loans are only available to owner-occupiers buying or refinancing in major Australian cities. Up is 100% owned by Bendigo Bank. New joiners get $10 by signing up to the app using code UPHOMEMOZO. (T&Cs apply) Mozo Experts Choice award winner.

  • Mozo Expert Choice Badge
    Variable Home Loan 90

    Principal and Interest, LVR <90%

    variable rate
    comparison rate
    Initial monthly repayment
    6.04% p.a.
    6.06% p.a.

    Affordable home loan rate for buyers or refinancers. No monthly or ongoing fees. Option to add an offset for 0.10%. Access to savings with unlimited redraws available. Minimum 10% deposit required. Advertised rates include Nov RBA rate increase. T&Cs apply.

  • Mortgage Simplifier

    LVR<80%, Owner Occupier, Principal & Interest

    variable rate
    comparison rate
    Initial monthly repayment
    6.14% p.a.
    6.43% p.a.

    Get a competitive variable rate with ING’s Mortgage Simplifier. Free extra repayments, no monthly or annual fees. Freedom to make free extra repayments or redraws. Winner of Australia’s Best Essential Bank in the Mozo Experts Choice Awards.

  • Flex Home Loan

    Owner Occupier, Principal & Interest, LVR <80%

    variable rate
    comparison rate
    Initial monthly repayment
    6.19% p.a.
    6.43% p.a.

    Competitive variable rate. Multiple offset accounts available. Borrowers can also make extra repayments. Redraw facility available. Simple online application process.


* WARNING: This comparison rate applies only to the example or examples given. Different amounts and terms will result in different comparison rates. Costs such as redraw fees or early repayment fees, and cost savings such as fee waivers, are not included in the comparison rate but may influence the cost of the loan. The comparison rate displayed is for a secured loan with monthly principal and interest repayments for $150,000 over 25 years.

** Initial monthly repayment figures are estimates only, based on the advertised rate. You can change the loan amount and term in the input boxes at the top of this table. Rates, fees and charges and therefore the total cost of the loan may vary depending on your loan amount, loan term, and credit history. Actual repayments will depend on your individual circumstances and interest rate changes.

^See information about the Mozo Experts Choice Home Loan Awards

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