What are the costs of buying a home?

Unfortunately, there are a number of fees and costs associated with buying a home. Here is a list of the more usual ones. Not all of them will apply to all situations.

Stamp duty — This is the big one. All other costs are relatively small by comparison. Stamp duty rates vary between state governments and also depend on the value of the property you buy. In NSW, stamp duty has been abolished for first home owners buying properties up to $650,000 and concessional rates applied to homes up to $800,000.

Legal and conveyancing fees — Generally around $1,000 – $1500, these fees cover all the legal requirements around your property purchase, including title searches.

Building inspection — This should be carried out by a qualified expert, such as a structural engineer, before you purchase the property. Your Contract of Sale should be subject to the building inspection, so if there are any structural problems you have the option to withdraw from the purchase without any significant financial penalties. A building inspection and report can cost up to $1,000, depending on the size of the property.

Pest inspection — Also to be carried out before purchase to ensure the property is free of problems, such as white ants. Your Contract of Sale should be subject to the pest inspection, so if any unwanted crawlies are found you may have the option to withdraw from the purchase without any significant financial penalties. Allow up to $500 depending on the size of the property.

Lender costs — Some lenders charge establishment fees to help cover the costs of their own valuation as well as administration fees.

Moving costs — Don’t forget to factor in the cost of a removalist if you plan on using one.

Connection costs – though not huge, the various utility connection fees can give your cashflow a temporary hit.