With affordability pressures and policy changes driving demand towards new builds, brokers have an opportunity to reduce friction in the buying process. This feature, sponsored by Deposit Power, explores the growing opportunity to reshape the new-build deposit conversation.
Amid housing pressures and sustained demand, there is a growing sense that the new-build segment may be approaching a renewed wave of activity.
Elevated interest rates and affordability challenges continue to weigh on buyers. Meanwhile, the 2026–27 federal budget (released 12 May 2026) contained several measures expected to drive more buyers towards the segment.
The government pledged $2 billion over four years to unlock development and deliver up to 65,000 additional homes, but the big headline was the tax concessions – specifically the treatment of the capital gains tax (CGT) discount and negative gearing.
From 1 July 2027, the government proposes to replace the 50 per cent CGT discount with cost base indexation and a 30 per cent minimum tax rate on capital gains. The change – which at time of writing was not yet law – is intended to apply only to gains arising after 1 July 2027, including for established investment properties already owned before that date.
It’s a similar story on the negative gearing side, with the mechanism set to be removed for established homes.
Eligible new builds, on the other hand, will be exempt from these changes, a move the government hopes will push investment towards increasing housing stock.
Against this backdrop, the states haven’t stood still either, rolling out a range of stamp duty concessions, exemptions and incentives aimed at encouraging new-build activity.
One potential implication of more activity in the new-build space could be a growing need for a way to help borrowers buy quickly without tying funds up in a purchase that won’t be settled immediately.
For Nick Rumpff, head of sales and distribution at Deposit Power, deposit bonds are an ideal solution.
“On established builds, the settlement period is often two or three months,” he says.
“Handing over a cash deposit in those scenarios can be palatable. But when you’re buying a new build, you’ve got your money sitting in a trust account for three or more years, and you’re not getting any financial benefit from that.
“Brokers can help clients ask the question – is there a better way to do this?”
Exploring the opportunity
While many brokers are aware of deposit bonds, Rumpff says the focus is now on helping them better understand the value these products can offer in new-build and off-the-plan transactions.
“They don’t always make the connection that deposit bonds provide a strong financial benefit, and they’re much safer to use than cash.”
This, combined with low awareness on the buyer side, creates a significant opportunity for a broker’s business.
“Your everyday buyer doesn’t know about deposit bonds. The percentage that do is very small – so there’s a great opportunity for education,” he adds.
“This provides a chance for brokers to be seen as a solution provider to their clients.”
Stepping in early
In many cases, part of what makes a deposit bond such an ideal solution for the new-build segment is the mindset of the buyer, Rumpff explains.
“When you’re talking about deciding to buy a new build, borrowing capacity isn’t their number one priority ahead of exchange. Buyers don’t need to sort out the loan approval yet. They might get a pre-approval, but the loan approval is for later on down the track at settlement, often years later,” he says.
“Traditionally, coming up with the cash deposit at exchange is by far your number one priority on a new build. And this is where brokers should be part of the conversion.
“It’s a big friction point, because it’s a lot of money and it’s something that needs to be handed over, usually years before the property is ready. So, it’s really important to help clients decide on the best deposit strategy early, before handing over such a large sum.”
Breaking down barriers
Naamat Chaaban, a mortgage specialist at NC Brokers, works with many new-build purchasers and says the initial deposit often presents a challenge.
“A lot of borrowers don’t want to downgrade or go to rent or sell their property while they’re waiting for their new property off the plan,” she says.
“They’d rather leave everything the way it is until the new property is built.
“With a deposit bond, they’re keeping benefits from their current property and gaining extra capital growth.”
Improving cash flow is another advantage Chaaban encourages brokers to consider.
“I’m a big advocate for deposit bonds. I use them myself all the time. Even if I had cash sitting around I would still use deposit bonds,” she says.
“Most of my clients are business owners, so cash flow is always an issue. The more cash I can leave with them to sustain their business, the easier it is.”
The security of the bond is another factor that can weigh on new-build buyers, according to Rumpff.
“Just having that upfront cash deposit is a big sticking point, but there can also be hesitation to hand over that amount of money to a third party for the three to five years while the property is built,” he says.
“Buyers want their money to be in the safest possible place.
“We think that’s with them, not with third parties.”
Starting the conversation
So how should brokers frame deposit bonds in conversations with their new-build clients?
Rumpff says the key is to start thinking about the deposit early, as part of a broader strategy, rather than simply a hurdle that needs to be navigated closer to settlement, as that would be too late to see the financial benefit.
“Instead of asking the question ‘How will my client pay for the cash deposit?’ Talk to clients early to educate them on deposit bonds, which effectively replaces the need to plan for an upfront cash deposit altogether. Help them ask the question ‘What is the best deposit strategy?’” he says.
“In the case of new builds, cash is often not the best option. This is where deposit bonds can deliver significant value.”
One advantage of this mindset for a broker is the ability to be seen as a solution provider earlier in the process, according to Rumpff.
“It’s about adding value earlier. Offering deposit bonds as a solution for clients, instead of doing a pre-approval, and then not talking to them again for three years,” he says.
“You’re able to provide a game changing solution to the client upfront, and in a competitive industry, this can help you stand out in the crowd.”
Case study:
Investing off the plan without tying up cash
Purchase price: $1,200,000
10 per cent deposit: $120,000
Sunset date: 4 years
Deposit bond fee: $14,400
By using a bond instead of cash upfront, buyers can secure a property and keep their $120,000 in:
An offset account at 5.75 per cent p.a. for four years which will provide them with a net saving of $13,200
Or
A high-interest earning account at 4.75 per cent p.a. for four years which will provide them with a net saving of $10,656
*Estimate only. Individual tax implications not taken into consideration
Buyers want their money to be in the safest possible place. We think that’s with them, not with third parties
A word from Deposit Power
Deposit Power takes a specialised approach to helping Australians secure their next property, providing a fast, flexible alternative to traditional cash deposits.
Our purpose is to give home buyers and property investors the confidence to act quickly in a competitive market, without needing to tie up large sums of cash for the deposit.
We work with buyers and brokers to simplify the process: to free up funds, enable faster property purchases, and provide peace of mind through a reliable, cost-effective solution.
Our approach aims to give borrowers the best of both worlds – the ability to secure the property they want while keeping their cash available, supported by Deposit Power bonds underwritten by HDI, which holds a “AA-” (Very Strong) credit rating from S&P Global Ratings, putting it on par with Australia’s major banks.
Buyers want their money to be in the safest possible place. We think that’s with them, not with third parties.
