Everything You Need to Know About Buying a Two Bedroom

A two bedroom property is often the most realistic entry point for first home buyers in WA.

Whether you're buying a unit in Perth or a house in a regional town, a two bedroom home can get you into the market sooner while still giving you enough space to live comfortably. The challenge is working out how much you can borrow, which grants apply, and whether your deposit will stretch far enough.

Understanding First Home Buyer Eligibility in WA

To access the WA First Home Owner Grant and stamp duty concessions, you need to be at least 18 years old, an Australian citizen or permanent resident, and purchasing your first home. You and your partner (if you have one) must not have previously owned a home in Australia.

The property must become your principal place of residence within 12 months of settlement, and you need to live there for at least six continuous months. Both new builds and established properties qualify for stamp duty concessions, but the grant itself only applies to new homes or off-the-plan purchases.

These requirements apply whether you're buying a two bedroom apartment in Subiaco or a house in Mandurah. The key difference is the value threshold and whether the property is new or established.

First Home Owner Grants and Stamp Duty Concessions

The WA First Home Owner Grant property cap has been increased from $750,000 to $800,000, making it easier to qualify if you're buying a new two bedroom property. You'll receive $10,000 towards your purchase if the property is valued under that threshold.

For stamp duty, no stamp duty is paid for dwellings purchased pre-construction up to $800,000, tapering to a 50% concession for homes above $900,000. If you're buying an established two bedroom property, you can still access stamp duty concessions, though the savings will depend on the purchase price.

Consider a buyer looking at a two bedroom unit in Fremantle. If the property is an established home, they won't qualify for the $10,000 grant, but they'll still benefit from the stamp duty concession, which can save several thousand dollars depending on the purchase price. If they opt for a new apartment in the same area, they could claim both the grant and the full stamp duty exemption, provided the property is under $800,000.

Low Deposit Options and the First Home Guarantee

The First Home Guarantee was massively expanded from 1 October 2025 with no income caps and no place limits, allowing eligible buyers to purchase with as little as a 5% deposit without paying Lenders Mortgage Insurance (LMI). This change has opened the door for buyers who previously couldn't save a 20% deposit.

Under this scheme, you can buy a two bedroom property with a smaller deposit and avoid the additional cost of LMI, which can run into thousands of dollars. The government guarantee covers the gap between your deposit and the 20% threshold, giving lenders the confidence to approve your loan.

If you're buying in regional WA, you might also qualify for the Regional First Home Buyer Guarantee, which works similarly but applies specifically to properties outside the Perth metro area. Both schemes can be combined with state grants and concessions, which means you can stack your benefits for maximum impact.

You'll find more detail on how the 5% deposit scheme works and which lenders participate in the program.

How Much Can You Borrow for a Two Bedroom Property?

Your borrowing capacity depends on your income, expenses, and existing debts. Lenders assess your ability to service a loan by looking at your net income after tax, then subtracting your living expenses, credit card limits, personal loans, and other commitments.

For a two bedroom property, you'll typically need to show that your income can cover the loan repayments plus a buffer, which most lenders calculate at around 3% above the current interest rate. If you're buying with a partner, both incomes are included in the assessment.

In our experience, buyers often underestimate how much their existing credit card limits affect borrowing capacity. Even if you don't carry a balance, lenders assume you could draw the full limit at any time, which reduces the amount they're willing to lend. Paying off or closing unused credit accounts before applying can increase your borrowing power by tens of thousands of dollars.

If you want to understand where you sit before you start looking at properties, a borrowing capacity assessment can give you a clear figure to work with.

Pre-Approval Gives You Confidence to Make an Offer

Pre-approval means a lender has assessed your financial position and confirmed they're willing to lend you a specific amount, subject to property valuation and final checks. It's not a guarantee, but it gives you a solid indication of what you can afford.

For two bedroom properties, especially apartments, pre-approval is particularly useful because it allows you to move quickly when you find the right place. Units in popular suburbs can sell within days, and having pre-approval in place means you're ready to make an offer without waiting for finance confirmation.

Pre-approval typically lasts three to six months, depending on the lender. If your circumstances change during that time, such as a new job or a change in income, you'll need to update the lender before proceeding.

Using the First Home Super Saver Scheme to Boost Your Deposit

The First Home Super Saver Scheme (FHSS) lets you save for a deposit inside superannuation at a 15% tax rate rather than your marginal rate. You can contribute up to $15,000 per financial year and withdraw a total of up to $50,000 for your first home deposit.

If you're earning a decent income, the tax saving can be significant. Instead of paying tax at your marginal rate (which could be 32.5% or higher), your super contributions are taxed at just 15%. Over a few years, that difference adds up.

You can make voluntary concessional contributions through salary sacrifice or personal deductible contributions, then apply to release the funds when you're ready to buy. The First Home Super Saver Scheme page walks through the application process and timelines.

Choosing Between a Unit and a Small House

Two bedroom units are common in metro Perth, particularly in suburbs close to the CBD, universities, and transport hubs. They're often more affordable than houses, but you'll need to factor in strata fees, which can range from $500 to $1,500 per quarter depending on the complex and included facilities.

Two bedroom houses are more common in outer suburbs and regional areas. They usually come with land, which means you're not paying strata fees, but they may be further from services and employment.

Lenders treat units and houses slightly differently. Some lenders have restrictions on high-density apartments or properties in certain postcodes, which can affect your ability to borrow or the interest rate you're offered. If you're looking at a unit in a large complex, it's worth checking with a broker whether any lenders have restrictions on that building.

Fixed or Variable Interest Rates for Your First Home Loan

A variable interest rate moves with the market, which means your repayments can go up or down. It usually comes with features like an offset account or redraw facility, which give you flexibility to pay extra or access funds if needed.

A fixed interest rate locks in your repayments for a set period, typically one to five years. You'll know exactly what you're paying each month, but you won't benefit if rates fall, and you may face break costs if you need to refinance or sell before the fixed term ends.

Many buyers split their loan, fixing part and leaving part variable. This gives you some certainty while keeping access to features like an offset account on the variable portion. Your broker can model different scenarios based on your income and risk tolerance.

For more on what happens when fixed terms end, the fixed rate expiry page covers your options.

What Happens After You Apply for a Home Loan

Once you've found a property and made an offer, your broker will lodge a formal loan application with the lender. You'll need to provide payslips, bank statements, proof of deposit, identification, and details about the property.

The lender will order a valuation to confirm the property is worth what you're paying for it. If the valuation comes in lower than the purchase price, the lender may reduce the loan amount, which means you'll need to make up the difference or renegotiate with the seller.

Settlement usually takes place four to six weeks after contracts are signed, though this can vary. Your broker will coordinate with your conveyancer or solicitor to make sure the loan funds are released on time.

If this is your first time going through the process, the first home buyers section has a timeline of what to expect at each stage.

Call one of our team or book an appointment at a time that works for you. We'll walk you through your options, check your eligibility for grants and concessions, and help you put together a loan application that reflects your circumstances. You can book an appointment online or give us a call to get started.

Frequently Asked Questions