Where to Save a Property Deposit in 2025: Top 3 Options

Saving for a property deposit can be one of the biggest financial goals in your life. Whether you’re aiming for your first home or looking to upgrade, it’s important to ensure your money is working as hard as possible while you build up your deposit. In 2025, there are a few key options to consider for stashing away those savings. We’ll explore three of the most popular: savings accounts, term deposits, and the First Home Super Saver Scheme (FHSS).

1. Savings Accounts: Flexibility with Easy Access

For those who prefer flexibility and the ability to access funds at any time, a high-interest savings account remains a top choice in 2025. Many banks continue to offer competitive interest rates for savings accounts, especially for accounts with bonus interest when you meet certain conditions, like regular deposits or limited withdrawals.

• Pros:

  • Instant access to your money

  • No lock-in periods, so if you find the right property, you can transfer your deposit quickly

  • Bonus interest can boost your savings if you meet conditions

• Cons:

  • Interest rates may fluctuate, particularly if the Reserve Bank adjusts the cash rate

  • You might miss out on higher returns available in other, less flexible options

A savings account is ideal if you're not sure exactly when you'll need to access your funds, as it offers the most liquidity.

2. Term Deposits: Stability and Predictable Growth

Term deposits are a great option if you want certainty around the growth of your savings. In a term deposit, your money is locked away for a fixed period—usually anywhere from a few months to several years—at a guaranteed interest rate. In 2025, with interest rates projected to remain relatively stable, term deposits can offer peace of mind for those who prefer stability over flexibility.

• Pros:

  • Fixed interest rates that guarantee your return

  • Safe and low-risk, as they’re backed by banks

  • Can be useful if you want to avoid the temptation to dip into your savings

• Cons:

  • Limited access to your money; withdrawing early may result in penalties or loss of interest

  • If interest rates rise during your term, you won’t benefit from those increases

Term deposits can suit savers who are a year or two away from purchasing a property and who want to secure a guaranteed return without taking any market risks.

3. The First Home Super Saver Scheme (FHSS): Boost Savings with Tax Benefits

The First Home Super Saver Scheme (FHSS) is a government initiative that allows first-time homebuyers to save for a deposit using their superannuation fund. You can make voluntary contributions of up to $15,000 per year (up to a maximum of $50,000 in total) into your super, which will be taxed at a lower rate than your regular income. When you’re ready to buy, you can withdraw these funds to put toward your deposit.

• Pros:

  • Significant tax savings, as contributions and earnings are taxed at a lower rate (15%) compared to your marginal tax rate

  • Potential for higher returns, depending on your super fund’s performance

  • Encourages disciplined saving by tying up your funds in super until you withdraw them for your home purchase

• Cons:

  • Limited to first home buyers, so not an option for everyone

  • Investment returns are subject to market fluctuations, so your savings could grow or shrink depending on how your super performs

  • Withdrawals are capped at $50,000, so you may need other savings options to fully fund your deposit

The FHSS is ideal for those looking for tax-efficient ways to save and who are eligible as first-time homebuyers.