How Much Does It Cost to Buy Your First Home?

Did you know buying a house often costs more than most people realise?

We've all heard about the golden deposit but it’s also important to be aware of several other costs when buying your first home. Being forewarned means you have time to prepare, so let’s look at some of the costs you’ll probably have when buying your first home.

Nine costs you should factor in when budgeting to buy your first home

1. Bank Fees
   Double check your bank fees, including the application and valuation charges, to minimise any last-minute surprises.

2. Stamp Duty
   We’ve all heard of it but what is it? It’s basically a government tax on certain property buying transactions. You might be eligible to waive of stamp duty depending on your circumstances, so chat to your mortgage broker.

3. Government Fees
   Remember: buying a house also involves the government.
   You may need to pay for mortgage registration, transfer fees, and title searches.

4. Legal Costs
   These may be settlement fees for your solicitor or conveyancer.

5. Property Checks
   Pre-purchase checks may include strata reports or building and pest inspections so you’re aware of any issues with the home you’re buying.

6. Removalists
   If you’re intending to hire removalists, you need to find out how much their services cost – some charge by the hour, some by the day. Be sure to confirm costs prior to the big moving day.

7. Utilities
   Some utility companies may charge a set up fee and require payment in advance for usage. Check the fine print so you know how much it may cost upon moving in.

8. Furniture
   How good are your flatpack assembly skills? If you don’t already own furniture, make a list of the essentials and work out your budget so you can buy what you need.  

9. Appliances
   Things we take for granted when living in our family’s home: Fridge, washing machine, microwave…
   Things that cost more than we expect: All the above.
   Once again – budget, budget, budget.

So, how do you cover all the home buying costs?

If only we all had a fairy Godmother to cover our home buying costs – buying a first home would be so much easier!

Anyway, let’s look at some ways you could save money to help cover your first home buying costs.

4 tips to help save for your home buying costs

1. Decide what sacrifices you’re willing to make
   Sometimes we must make tough choices – which may include cutting back on the things we enjoy, such as TV subscriptions or happy hour. Try to be realistic though – if you cut out all the fun stuff, you might find it harder to stick to the budget. If you’re not sure where to begin, chat to your finance specialist.

2. Figure out how much you need to save
   Pick a number, any number. Or ask your mortgage broker to help you.

3. Become a goal setter to help you save
   Break down your saving plan into small goals and try to put your savings in an interest earning, transaction account. It may help you feel less tempted to use the money in your savings for other things.

4. Think long term when you get your tax return
   Instead of spending it on fun stuff AKA a weekend away or big night out, put the money in your savings account.

Figuring out how much you need to save up to cover your home buying costs may be a bit tricky. Contact Pania if you need some help preparing for your first home buying experience.