Factoring in all the costs

When working out your home buying costs, a great place to start involves calculating how much you can afford to borrow, which means factoring in all your upfront costs. Besides the price of your property, these other costs associated with securing your new apartment are listed below.

Generally, it’s recommended that you allow an extra 5% on top of your purchase price to help cover these expenses:

Loan application charges

Be aware that your lender may charge the following fees. These include:

  • Loan application fee
  • Lender’s property valuation fees
  • Lenders Mortgage Insurance (LMI) – this insurance protects your lender, and is a once-off payment that can apply unless you can put down a deposit of 20% or more.

As a rough guide, your loan application fee and lenders property valuation fees can add up to over $1,000.

Government charges

Please note that the below charges are different in each State and territory.

  • Purchase stamp duty – a tax calculated on your property’s purchase price
  • Mortgage registration fee – an administrative cost by the Land Titles Office for registering the lender’s mortgage on the title record for your property

Legal fees

The cost of solicitors or conveyancers who carry out the legal paperwork involved in purchasing your first place will vary between providers, but fees can typically cost up to $2,000.

Home building and contents insurance

Once you have paid a deposit of your property, this is often a good time to arrange appropriate building insurance. This insurance protects your home building and personal contents and belongings in the instance of natural disasters or burglary.

Mortgage protection insurance

Taking care of part or all your mortgage repayments for your new property, this insurance will assist in the event of being injured or too ill to return to work, or even if you pass away. Costs of mortgage protection insurance will vary depending on the extent of cover you take out.

Income protection insurance

If you’re no longer able to work or earn money due to illness or injury, this insurance covers you by providing an income stream generally worth around 75% of your current wage. Premiums are also usually tax deductable.

Moving in costs

The most exciting part of moving into your new place comes with costs too! These can include furniture removal, utility connections and strata fees. A pre-purchase building inspection will help to point out any potential defects, and a strata search will provide information on levies, insurance details, disputes and a history of repairs.


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