Hidden Costs For First-Home Buyers

18:47' 05-03-2018
First-home buyers give a lot of thought to finding a house at the right price, getting a loan, and saving a deposit.

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    However, Nicole Frosttwitter of Domain points out that these are only the major costs. There are other costs you should consider, to avoid a nasty surprise.

     

    Building report

    It might cost a few thousand dollars to get a quality building report, but it can save you money in the long run. A report on structural weakness or insect damage helps you make a wiser purchase decision. Any damage you discover after you have bought the property could ruin your budget. The cost of a report buys you peace of mind.

    Conveyancing

    Conveyancing deals with the laws of transfer and ownership of property. A conveyancer can make the process run more smoothly for you, by reviewing your Contract of Sale, liaising with banks and the seller’s lawyers, and making sure the relevant documents are prepared.

    Conveyancing laws vary from state to state, with fees usually in the $1500 to $2000 range. You don't have to hire a conveyancer, but if you don't understand all the legal requirements, it is the safest option.

    Government and bank fees

    Stamp duty, property transfer fee, and mortgage registration fee are government costs for new buyers. For home loans, there are also the loan application fee, ongoing bank fees and the lender’s property valuation to consider.

    Condition of property

    Buying a home is not like renting. Under a rental lease, the renter must leave the property in good clean condition. However, when an owner moves out, there is no such requirement. You might have to hire a professional cleaner, at a cost of $500 or more. This is especially important if you plan to rent the property, rather than live in it yourself.

    Unexpected repairs

    Depending on the age of the property, you might find that soon after you move in, the hot water system or air conditioning breaks down, and needs major repair or replacement. In some cases, structural work which did not show up in a builder's report may be needed. Also, fittings such as blinds, curtains and security grilles might not be included in the house and land package. It is recommended you put aside $4000 to $5000 for these kinds of issues.

    Park W

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