This is a difficult question to answer because it's all about timing, property market value movements and interest rate futures. The conservative approach is to save until you have your 20% deposit, thus avoiding having to pay $6,000 or more for LMI if you can't find, or don't want to use, a loan guarantor. But in the time it takes you to save the deposit – probably about five years if you're starting from scratch, or at least a couple of years if you already have some savings – property market values could lift overall by a percentage that would make the $6,000 LMI premium seem like a trivial amount. But there are arguments on the other side. No one can be sure that property prices will continue to increase, or that interest rates will not increase. Making a rash decision to go ahead with a small deposit could backfire if property prices in general start to decline or variable rates go up. You'll be left with a large loan to be serviced by substantial monthly repayments, and the possibility of negative equity in your home. So look carefully at what the experts are saying about the likely future of property price movements in your area, decide how much risk you can handle, and make an informed decision about when to buy.