Understanding Buying Costs
From stamp duty to conveyancing — know what to budget. Buying a property involves more than just the purchase price. Here’s a simple breakdown of the true costs of buying so you can plan your budget with confidence.
1. Deposit
Most lenders require a 5–20% deposit.
Aim for at least 10% to avoid Lenders Mortgage Insurance (LMI).
If you qualify for a First Home Buyer or Government Scheme, you may buy with as little as 5%.
2. Stamp Duty (Transfer Duty)
A state government tax based on the property’s value.
Each state has different rates and concessions for first-home buyers.
In South Australia, stamp duty for a $600,000 home can exceed $25,000 if no concessions apply.
Use your state’s stamp-duty calculator before making an offer.
3. Lenders Mortgage Insurance (LMI)
If your deposit is under 20%, your lender may charge LMI to protect them against default.
It can range from 1–4% of the loan amount.
Some lenders let you add LMI to your loan; others require upfront payment.
4. Conveyancing & Legal Fees
You’ll need a conveyancer or property lawyer to handle title transfers and searches.
Expect $1,000–$2,500, depending on complexity.
They’ll also check for easements, zoning issues, and council rates.
5. Building & Pest Inspections
A critical step before signing.
Budget $400–$800 for combined inspections.
They can save you thousands by identifying structural or termite issues early.
6. Loan & Settlement Costs
Loan application or service fees: $200–$600 (often waived).
Settlement adjustments: Council rates, water, and utilities are split between buyer and seller.
Bank valuation fee: Around $200–$400.
7. Moving & Setup Costs
Include removalists, insurance, and utilities setup.
$1,000–$3,000+ depending on distance and services.
Don’t forget new furniture, appliances, or internet connection fees.
8. Ongoing Ownership Costs
Once you own the home, budget for:
Council & water rates – typically $2,000–$3,500 per year.
Home insurance – about $1,200–$2,500 annually.
Maintenance – set aside 1–2% of property value each year for upkeep.
Quick Budget Example
For a $600,000 property, here’s what to budget for:
Deposit: Around $60,000 (10% of the purchase price).
Stamp Duty: Approximately $25,000, depending on your state and available concessions.
Conveyancing & Legal Fees: About $1,800 for contracts, title transfers, and searches.
Lenders Mortgage Insurance (LMI): Around $8,000 if your deposit is under 20%.
Building & Pest Inspections: Typically $600 for a combined report.
Moving & Setup Costs: Roughly $2,000 for removalists, utilities, and basic setup.
Estimated Total Upfront Costs: ≈ $97,400 before ongoing ownership expenses.
DON’T HAVE 97K IN SAVINGS? CHAT TO US, WE CAN FIND YOU WAYS TO GET INTO THE PROPERTY MARKET FOR LESS.
Proptip: Always keep a small buffer (around 3–5% of purchase price) for unexpected costs.
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The Takeaway
Buying a home involves more than just saving for a deposit. You’ll also need to plan for stamp duty, legal fees, inspections, and ongoing costs like rates and insurance.
At PropTip, we help you understand every cost before you buy. Our guides, tools, and buyer support make it easy to budget accurately, compare properties, and plan with confidence.
Whether you’re a first-home buyer or investor, PropTip gives you the clarity and strategy to buy smarter — not just faster.