The common sense guide to saving up a house deposit

With reserve interest rates at record lows, and the housing market starting to once again creep back from hiatus, many people are casting their minds to the great Australian dream - home ownership.

If you'd like to nab yourself a slice of that financial pie, here are our best tips on how to save up for a house or apartment deposit.

Stabilise your spending

Traditional lenders, like banks, will now look at every purchase with a fine-tooth comb. They'll not only assess debts (and your history of accruing and repaying them), but also the "incidentals" and "miscellaneous" of your spending habits. Take them seriously, name them appropriately and categorise them intelligently.

Put at least six solid months of effort into repaying your debts, whether you follow the consolidation (everything at once at a more manageable interest rate), or debt snowball method (smallest first for momentum, largest last for impact). This shows that while you have liabilities, you have capability to service them.

Make it a challenge

The reality of home ownership isn't just the deposit, which is between 5%-20% of the purchase price, but also stamp duty (which varies by state), conveyancing or legal fees and any building or pest inspections you will want to have done.

In addition, you might be looking at ongoing strata costs - are they manageable? Are there any unpaid levies that will fall to you? Were any renovations undertaken by the previous owners that weren't approved by council, causing you grief later on?

Every dollar you can pile away will contribute significantly to these costs, so make it a challenge.

Print a savings chart and mark every dollar that goes in until you hit your goal. Set up automatic rounding up with your online banking and transfer the savings into a dedicated property fund every month. Keep a physical piggy bank (old sparkling water bottles are perfect for storing exactly $1000 in $2 coins).

Give yourself a timeline

David Bowie and Queen had the right idea - being under pressure accelerates many savings goals.

Give yourself a realistic timeline based on your budget and savings projections (a good rule of thumb is to add an extra three months onto your ideal number) and use a low-risk bond, term deposit or savings account with a bonus interest rate to do some of the heavy lifting for you.

And while budgeting isn't always fun, try and reimagine the way you think about it. The 80/20 rule is about being 80% robot and 20% human with your disposable income. Use that 20% to fill your cup and satiate your not-so-frugal habits, but keep the 80% cemented for long-term goals.

Be open to options

Low-deposit home loans that allow you to borrow more than 80% of the property value should always be assessed with large degrees of caution, but they can be a good way to get your foot in the door if the perfect property pops up.

While it's always better to begin with as much equity as possible, lenders mortgage insurance isn't necessarily worthy of the bad rap it's been given and the upfront cost is easily outweighed by a solid purchase long-term.

In addition, competitive schemes like the First Home Loan Deposit Scheme (FHLDS) sees the government guaranteeing 10,000 low-deposit loans a year for eligible low and middle-income earners with only a 5% deposit. Or you could use a guarantor to mitigate some of the risk for the bank, with responsible, airtight terms for the both of you.

Remember: if the property and the market is right for you, don't miss the opportunity.

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