Buying a Home: How Much Do You Need on Top of Your Deposit?

February 22, 2019

So, you’ve got your deposit and you’re ready to dive into the property market!

We hate to be the bearer of bad news but have you thought about the additional costs involved? Read on to find out more about the total cost of buying a home.

First off, congrats on saving up your deposit!

We know saving up a large sum can be really difficult so, well done. Now, before you start the fun part - researching what style of property you would like to invest in - it’s important to understand the additional financial costs involved in buying. We don’t want you to get caught out.

Let’s go over all the extra and hidden costs so you know upfront how much money you’ll need before you make the next big step in your home-owning journey.

Stamp duty

Apart from your deposit, this will be your largest lump sum cost. Stamp (or land transfer) duty refers to the state government tax you must pay whenever you purchase a property.

Depending on the state you’re in, as well as factors like whether the property is newly constructed or you are buying it as a family home will impact how much you have to pay. First home buyers, however, can take advantage of government grants to minimise this cost.

There are plenty of guides and calculators online to get an estimate of what you would be likely to pay. Click here to try one out!

Lenders Mortgage Insurance (LMI)

If you don’t have more than a 20% deposit saved up, most lenders will require you to pay Lenders Mortgage Insurance. Again, this fee can vary wildly between different states and different circumstances. Expect it to be at least a few thousand dollars.

Inspection fees

Building inspections are vital when buying property. This ensures the building is safe and can alert you to future issues the property may have. It’s also a good idea to have a pest control professional to perform an inspection. You don’t want any nasty surprises after you’ve moved in. You can estimate both these inspections to cost a few hundred dollars each.

Home, building & contents insurance

Anyone with a mortgage must have building insurance. In Australia, this is compulsory. Often, homeowners will take out a home, building, and contents insurance policy to guard against accidents or natural disasters. This price can range depending on the type of home you invest in and your belongings but a safe guess would be around $1,500 - $2,000 per year.

Connecting amenities

An easy one to forget! You will have to pay connection fees for amenities like gas, power, and internet service/phone lines.

Mortgage registration fee

This one will vary depending on your circumstances but on average they are around $150.00.

Legal/conveyancing fees

The process of buying a home is a legal and financial one with lots of important documents to look over - none more important than the contract of sale. You will need to engage a trusted legal professional (like us!) to help you understand this document and make sure it is in your best interests. This part of the home buying journey is called conveyancing and it isn’t free! Make sure to keep around $800.00 aside for this step.
Loan application fee

Taking out your loan will also incur a fee. You can inquire with your lender about how much it will cost. Generally speaking, you’re looking at $200 - $700 depending on the type and size of your loan.
Council rates

The vendor (person selling the property) will have paid any land rates owing to the council for the remaining quarter. At settlement, the rates of the new quarter will commonly be added to the overall purchase price and therefore must be paid by the buyer of the property.


When you are finally ready to move into your new property, you will most likely need to hire removalists. Don’t forget to factor this one in. Depending on how much stuff you’re bringing with you from your old home, the price will range from around $1,000 to $5,000. In addition to removalists, you may also need to set aside money for storage hire and cleaning services.

Now, we know that list seems long. But, don’t get discouraged - you’ve got this! We suggest talking with your bank and working with them to devise a savings plan right for you - one which ensures you save well over your deposit amount.

There are ways you can cut down on costs in one stage of the process of moving to a new home, however. And, that is - moving out!

Tips for cutting costs when moving to a new home

- Be flexible with your move date - choose an ‘off-peak’ time to move if possible, this will make a difference in the total cost of removalists
- Shop around. Make sure to get a few different quotes and look out for removal businesses that are offering sale prices
- Hire a truck and do some of the moving yourself - stick to the smaller decor items and personal belongings and you’ll cut down on removalist costs
- Hire supplies rather than buying them - this includes storage boxes and dollies
- Ask around at the supermarket and liquor shop for extra boxes - they are more than likely ready to give you them for free!

If you need more info regarding the legal aspects of buying a home, get in touch with us through our contact page.

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