In this article, you will learn about the hidden costs of buying a property in Australia. Many people don't realise that this "hidden cost" could add up to a big amount if you are not careful enough. You may have seen the property on sale in a fancy real estate advertisement.
But they never mention these hidden costs whatsoever. So that could create an unfortunate situation for someone planning to buy a property with a limited budget. Especially in Australia, various indirect payments must be made when buying a property. So let's see.
Hiring or involving a conveyancer/other professionals to do the necessary paperwork for your property costs a particular amount depending on the state and the reputation of the firms you work with. Mainly conveyancing involves the preparation, implementation, and, finally, the lodgement of the documents to ensure a seamless legal sale.
The amount you will be paying as the legal fees and conveyancing solely depend on how complicated the process and transaction are. Sometimes it can take weeks to get this process done successfully.
Stamp duty is a cost the state and territory government must pay when buying land or property. This cost can be quite expensive and ranges to tens of thousands of dollars depending on the property's value. You will have to pay a high stamp duty cost if the property seems high.
For instance, a million-dollar property can cost about 50,000-55,000. However, if you are happened to be the first buyer, states such as Victoria, New South Wales, and Queensland do not have to pay the stamp duty fee.
This is a vital process that needs to be done by a professional to assess the quality of the property. This mandatory process has to be done before putting an offer on a particular property or land.
A common inspection covers faulty roofs, cracked walls, dampness, mould issues, etc. The outcome of this inspection is determining whether the damages can be repaired and how much it would cost to fix them. And also, the process of checking pest damage can cost extra as it does not come in the standard inspection package.
It is crucial to find out if there is damage from termites and other pests. So it is always recommended to get the pest inspection done, even though it costs extra. There are some instances where the pest and building inspections are unnecessary if the building developer can provide the required certification to prove it is up to the industry standard.
These registration fees are required during the formal transferring process of property ownership. This cost can vary depending on the state as it can be either fixed or a range of amounts.
These costs can be encountered when setting up a loan with a lender. This fee usually depends on the loan amount, the lender, and other factors. It can be either fixed fees or a percentage of the loan amount. Especially this can vary if you have hired a mortgage broker. It can also be stated that these fees are not necessary under certain situations and conditions.
Buyers have to consider the council rates as well as water rates when buying a particular property. When the seller offers you the formal ownership of the property, they have already settled the rates with the local council until the end of the quarter. The remaining buyer's portion is being added to the purchase cost.
Council rates are evaluated by the local council depending on the land valuation, usually done by the state government every year. When it comes to the water rates, the seller must settle the water bill, which is used until the settlement date.
Apart from the above-mentioned indirect costs, there are a few other costs that you have to consider, such as the moving cost. If you are finally planning to move into your dream house, you must have a budget to transport all your furniture, devices, and personal belongings to the new house. This can vary depending on how far the transportation is or how long it would take to load and unload these things.
Finally, you must remember the investment property costs. As it is apparent, buying a property in Australia is not easy. Make sure to have a better idea of these extra costs, so you will be reassured at the last minute.
In the journey to homeownership, financial acumen plays a vital role in determining how smoothly you can navigate the labyrinth of loan repayments. Among the financial tools that can potentially speed up this journey, and save you money, is offset accounts in Islamic Home loans. But what exactly is an offset account? How does it […]
National Australia Bank (NAB), guided by Dr. Imran Lum, has been honoured with the Islamic Bank of the Year award at The Asset Triple A Islamic Finance Awards 2023. Though not primarily an Islamic bank, this recognition serves as an unequivocal endorsement of the strides NAB Islamic Finance has made in the sector, both within […]