Costs relating to the property
Land transfer stamp duty
This is a charge levied by the government to transfer ownership of a property. As with Mortgage stamp duty, this charge varies from state to state and depending on whether the property is to be owner occupied or an investment property. There are also concessions for first homebuyers which also vary from state to state.
Registration of transfer fees
These fees relate to registering your ownership of the property with the Land Titles office.
Conveyancing fees
These are the fees and charges by your solicitor for attending to the settlement and transfer of the property into your name.
Building and pest inspection fees
It is wise to have both of these inspections conducted and have your offer to purchase the property subject to their satisfactory outcome. As the purchaser you will be required to pay for these inspections which can vary between $200 and $500 each.
Are these fees negotiable?
Stamp duty and registration fees are set fees and are not negotiable. Your solicitor’s fees and any inspection fees however may be negotiable.
Click here to use the Property and finance costs calculator provided by the Mortgage and Finance Association of Australia (MFAA)
Costs relating to your finance
Loan Application Fees
These cover the lenders costs in processing your application including contracts, credit checks etc
Valuation Fees
In some cases the lender may require an independent valuation of the property being purchased or refinanced.
Service Fees (or ongoing fees)
These may be charged on a monthly or annual basis either for a package (see professional packages) or for facilities you have within your financing arrangement.
By paying package fees you may be entitled to discounts on other banking fees and charges – for example free transaction accounts, offset accounts and credit cards.
Mortgage establishment and registration fees
These include the costs of securing your loan against the property and registering this security with the government.
Mortgage Stamp Duty
This is a charge levied by the government on raising a mortgage. This charge varies from state to state and depending on whether the property is to be owner occupied or an investment property. There are also concessions for first homebuyers which also vary from state to state.
Lenders Mortgage Insurance
This is required on all loans where more than 80% of the value or purchase price of the property is borrowed. Refer here for more information.
Are these fees negotiable?
Mortgage Stamp duty, establishment and registration fees as well as Lenders Mortgage Insurance are set fees and are not negotiable.
Fees levied by your lender however such as loan Application fees and valuation fees may well be negotiable. Bear in mind that no costs on application may in some cases mean higher ongoing and exit costs. Your finance broker will be able to advise you based on the lender and loan you have chosen.
Click here to use the Property and finance costs calculator provided by the Mortgage and Finance Association of Australia (MFAA)
Costs of owning your property
Homeowners insurance
This insurance covers the risk of damage to the building rather than your possessions inside it (or contents). In some states you are required to hold homeowners insurance on a home on which you have made an offer within a specified time period of having made that offer. For example in Queensland this time period is the close of the next business day.
Utility connection and deposit costs
You may be required to pay a connection fee and possibly a deposit in order to have utilities like electricity and gas connected.
Removal and temporary accomodation costs
You will need to cover the costs of moving your possessions to your new home as well as possibly needing to pay for temporary accommodation should you need to move out of your existing home before your new home settles.
Council rates
As the owner of a property you will be liable for council rates unless you have purchased an apartment or unit in which case you may be charged Body Corporate Fees.
Body Corporate Fees
These would be charged by the managing body of your apartment or units and would include rates as well as costs of maintenance and repairs to the common areas amongst others.
Life, Total Permanent Disability, Trauma and income protection insurance
It is wise to consider insuring both the life and income of the primary incomer earner(s) when taking out a buying a property and taking out a home loan. This will protect your family from having to sell the family home should something unfortunate happen to you.
- Life insurance – protects your family financially in the event of your death.
- Total permanent disability and trauma insurance – protects you and your family financially in the event of your becoming disabled due to injury or illness.