Extra Costs to Consider When Buying a Home
When purchasing a property it’s important to be prepared for the costs beyond the deposit.
Knowing these upfront costs can help you budget effectively and avoid any financial surprises.
Here's a detailed guide to help you navigate these additional expenses.
Stamp Duty
Stamp duty is a significant cost and varies by state and property value. It’s a government tax on the purchase price of your property. If you’re a first home buyer you may be able to avoid this cost, check out our blog with state specific information to help you.
Government Fees
These include registration fees to transfer the property from the sellers names into yours, & varies by state and property value. This stamp duty calculator will also display how much you need to keep aside for this.
Legal/Conveyancing Fees
You'll need a solicitor, also known as a conveyancer, to handle the legal aspects of your property purchase like getting the property from the sellers name to yours. They also review your contracts and conduct property searches on your behalf. Budget for around $1500.
Lenders Mortgage Insurance (LMI)
If your deposit is less than 20%, you may need to pay LMI. This insurance protects the lender in case you default on your loan. The closer you are to a 20% deposit, the lower the fee, and your loan may be able to fund this cost. Eligible buyers, like single parents or first-time buyers, may access the Home Guarantee Scheme to waive this fee. Other options include having a guarantor or qualifying for LMI waivers offered to specific professions like lawyers, accountants, medical professionals, veterinarians and more. Speak to your broker to explore your options today.
Building & Pest Inspection
Before purchasing, it's wise to conduct building and pest inspections to ensure the property is in good condition. This helps avoid unexpected repair costs later. If there are costly building defects picked up in the inspection report, you can also re-negotiate the purchase price! Budget for $500 to $1000.
Other Miscellaneous Costs
It's smart to budget an additional allowance (approx. $2,000) for other costs such as council rates and body corporate fees (for units or townhouses) or unexpected costs that may pop up throughout the process.
Removalist Fees
Don’t forget to factor in the cost of moving your belongings to your new home! Hot tip for those who don’t mind getting sweaty: U-Haul or Move Yourself have large cage trailers for hire that are great for moving furniture on a budget with!
Furniture (if applicable)
If you’re upgrading or buying new furniture, include these expenses in your budget.
Insurance
Home and contents insurance is essential to protect your new home from unexpected events. Be sure to reach out to a great Insurance broker for the best deal. We highly recommend West Rock Insurance Brokers
Immediate Property Maintenance
Be prepared for any immediate maintenance or repairs needed once you move in. Check out our property inspection tips to help you keep an eye out for these.
Understanding and planning for these additional upfront costs can make your home buying process smoother and more predictable.
If you need more personalised advice or assistance, don’t hesitate to book an appointment with us. We’re here to guide you every step of the way!
Ready to start your home buying journey?
Contact us today for a complimentary consultation and let us help you plan your path to homeownership.
Your Broker,
Tara
