Buying a house involves more than just the property's price tag. For Perth homebuyers, being financially prepared means understanding the plethora of additional costs that come with the process. To avoid being caught off guard, it's crucial to factor in these expenses when budgeting for your new home.
Here's a breakdown of the various fees and costs you should anticipate:
Bank Fees
Financial institutions often charge several fees associated with a home loan. These can include application fees, valuation fees, document preparation fees, bank cheque fees, and ongoing account service charges. The amounts vary among lenders, making it essential to research and comprehend the specific fees applicable to your loan.
Lender's Mortgage Insurance (LMI) might be levied if your deposit is less than 20% of the property value. Typically ranging from 1-3% of the loan amount, this insurance protects the lender. Saving a larger deposit or offering additional security can help avoid this fee.
WA Government Fees
Mortgage Registration and Transfer Duty are key expenses. Mortgage registration incurs a Landgate registration fee, while Transfer Duty, more commonly known as Stamp Duty, is a tax based on the property's purchase price. First-home buyers in Perth buying properties valued at $430,000 or less may be exempt from Transfer Duty, but rates and exemptions can vary. Checking the WA Department of Finance for updated information is advisable. The link to their online stamp duty calculator is provided below.
Professional Fees
Real estate agent commissions, typically between 2-2.5% in Perth, are usually covered by the seller. However, if you're selling a property to purchase another, you'll need to pay your agent's commission.
A conveyancer or settlement agent is crucial for legally transferring ownership. They conduct property and title searches, ensuring the seller's legitimacy and handling strata property inquiries if applicable. It is recommended that you obtain quotes for your settlement agents fees prior to engaging their services.
Other Costs
Utilities and services connections, including gas, electricity, telephone, internet, and Foxtel, might require one-time payments upon moving in. Your conveyancer in Perth can assist in setting up a new water account with the Water Corporation during the settlement process.
Engaging a removal company is common unless you opt for family and friends' assistance. Removalists in Perth charge hourly rates based on truck size and staff numbers. Considering insurance coverage, extra charges, and calculating time from depot departure to return is essential.
Building and pest inspections, though optional, are recommended to avoid potentially costly issues. While the fee varies based on property size and items checked, it's a prudent investment that can reveal hidden problems, potentially allowing renegotiation of the offer price.
Understanding these costs associated with buying a house in Perth is integral to effective budgeting. Being well-prepared financially ensures a smoother transition into your new home without unexpected financial strain.
Reducing Time & Costs on Shifting Furniture
Having moved 29 times in 58 years of marriage due to:
- Changing family size
- Changing schools and attending university
- Changing economic circumstances (up and down)
Gordon has developed a plan to assist you.
The Plan:
- Get at least an A4 plan of the house you are moving to (label each room).
- Tag each:
- piece of furniture
- each box / container with what’s in it and what room it needs to go to
- Sketch into the plan what furniture you want in each room and the number of containers to go in front of them
- Make several copies and put them in each room and give a copy to each carrier
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