House buying costs

[Dano169]

Happy new year everyone

 

I have a question regarding the upfront costs when buying a house like solicitors etc? I know there is a LMI insurance if your deposit is less than 20% but I guess that can be added to you mortgage? Just like to know average amount for other costs on a house say that costs 400k? Also I believe that if you are a first time buyer there is no stamp duty to pay?

 

Thanks

[Walkabout]

Hi, As with everything prices do vary depending on your purchase prices, there is a free limit I believe for 1st time buyers with stamp duty, I am not sure of the actual amount, I think it changed (went down) last year and is around the $400,000 mark now, so again your purchase price will influence this. other costs that we recently paid when buying include;

 

Conveyancing Fee, I believe it is set at $1,906.25 but you will always get a discount it just depends how much, its usually anything up to about 40 or 50%

Transfer Duty (Residential Concession (Stamp duty if applicable)

Registration Fee approx $290.00

Title Searches approx $60.00

Bank Cheque Fee approx $10.00

Water Corporation Enquiry Fees approx $43.30

Approximate Local Authority Enquiry Fee approx $75.00

Land Tax Enquiry Fee $35.00

Clause 42 Enquiry Fee $25.00

Approximate Landgate Fees $22.00

Total GST on Disbursements % of total

You will also have to pay the % of council fees for the remaining part of the year (like council tax) will be calculated depending on the amount that house pays per year and when you take ownership

 

Hope that helps - really the LMI and stamp duty are the big ones. LMI can be added on to your mortgage for some lenders and not for others, just depends on who you go with but I think for all of them you have to hit a magic number of I think no more that 97% for the total mortgage value on the purchase.

 

You can also qualify for a first time buyers grant, if buying established that is around $3000, for new builds its more, sorry I dont know the figures for that. if you talk to the bank or a mortgage broker they will be able to go through all the costs with you though.

[Dano169]

Thanks for your reply walkabout

[Home Loan Experts]

Good question Dano169, as a rule of thumb I always advise my clients to have 5% of purchase price + another 5% to cover the purchase costs such as stamp duty, solicitors costs, etc... Solicitor/Conveyancer fees vary depending on what you can negotiate but they usually range from $1200-$1500 and then there is a bunch of smaller admin costs like Title Search & Registration fees, etc.

 

That being said - you do not want to be cutting it too thing when it comes to the minimum funds that you have to complete a purchase as its always good to have a contingency. The First Home Buyer Grants and Stamp Duty Concessions vary from state to state and are always being reviewed so it depends on where you are and what you are purchasing.

 

I recommend you speak to an experienced mortgage broker they will be able to work out the minimum contribution for your circumstance and give you a break down of the funding position based on your unique overall position

 

Cheers,

Grant Martin

Mortgage Broker

https://www.homeloanexperts.com.au/our-team/mortgage-broker-grant-martin/

Edited January 7, 2015 by Home Loan Experts

[Dano169]

Thanks for that Grant

[Lou8670]

I heard the stamp duty threshold for first time buyers was $430k and was on an increasing scale so by the time you get to $600k you pay normal stamp in full.