- Posted 20 Apr
- 0 Comments
Buying a new home in itself is an extremely costly purchase, but have you considered the amount of money you will need for a new home above and beyond the purchase price and deposit of a new home?
Additional costs involved in buying a house can often add up to approximately 10% of the purchase price, so it’s important to do your sums before leaping into the property market. Once you’ve committed to buying a home, look to Australian Credit and Finance to assist you in understanding all the costs associated with this large investment.
Stamp Duty Taxes and Fees
Stamp Duty tax is a charge by the state or territory government, so the amount will vary depending on where you live, but it usually is one of the biggest hits to your wallet.
You will also be charged a registration fee which covers the cost of lodging and registering the transfer of and documentation with the state title office. Again, these fees vary from state to state.
Home Loan Costs
Read the fines lines in your paperwork when you choose your home loan lender. Most lenders will charge a range of fees for arranging your home loan. Fees can include establishment fee, service fee, and maybe even a fixed lock rate.
There is a possibility you may have to pay a Lenders Mortgage Insurance (LMI) if you’re borrowing more than 80% of the purchase price.
General Purchase Costs
In addition to purchase price, deposit, fees and taxes from lenders and state, there are a few more items to consider.
- Legal Fees: Your solicitor or conveyancer will organise the legalities of transferring the property from one person to another. Make sure to ask what the estimation fees are for this.
- Title Search: Performed by your legal representative, it makes sure that the seller is able to sell the property and whether there are any encumbrances.
- Inspection Reports: These may include building, strata and pest inspections.
Continuous Costs of Homeownership
Besides all the costs that go into just the purchase of the home, make sure to consider and think about all the other costs that go into owning your own home. A benefit of renting is if something breaks, the landlord or the property manager is responsible for paying and fixing it. With your own home you will be responsible for all costs like plumbing or electricity issues, lawn care and any repairs the home may need.
Also monthly bills such as utilities, electrical, internet and media costs should be averaged into your monthly budget and bills.
The Actual Move
Don’t discount the cost of moving from home to home. Whether you are hiring professionals or doing it yourself, take into account moving trucks, labour help, boxes, cleaning fees, etc.
Australian Credit and Finance can help you get a full understanding of what’s involved and the fee’s associated with purchasing a new home. Contact our friendly team today to answer any questions you have or assist you with your home loan.